KCRag Forum

FangKC wrote:Isn't the problem though that these states want to do away with the state income tax, and raise the sales tax, which isn't deductible on federal returns for most people.

Sales tax increases hurt low income and poor more as well, and seniors.

The other question to ask is would increased sales taxes affect consumer spending, which our economy is very dependent on. Would reductions in consumer spending offset any gains from having no state income tax? It just seems to me that this is switching one tax for another, and the alternative is a tax that hurts lower income and poor people, and benefits higher income residents.

In addition, let's say that Kansas has no state income tax, and raises its' sales tax. Missouri retains income tax, and has a lower sales tax. Wouldn't most Kansans just cross the border to buy things with lower sales taxes?

aknowledgeableperson wrote:One item in Kansas favor on this issue is energy. The domestic energy boom is expected to benefit KS quite a bit, at least according to some.
On a different matter, on channel 41 news at 6:00 yesterday they reported that the number of business licenses in Kansas was at it's highest level last year.

AJoD wrote:http://www.omaha.com/article/20130115/N ... income-tax

KCMax wrote:

aknowledgeableperson wrote:One item in Kansas favor on this issue is energy. The domestic energy boom is expected to benefit KS quite a bit, at least according to some.
On a different matter, on channel 41 news at 6:00 yesterday they reported that the number of business licenses in Kansas was at it's highest level last year.

I listened to a presentation from someone in the Governor's office and he echoed this. They're expecting huge deposits of natural gas in western Kansas to pay off and I think there was a new oil field near Oklahoma maybe they expected to generate some revenue.

Zorobabel wrote:

KCMax wrote:

aknowledgeableperson wrote:One item in Kansas favor on this issue is energy. The domestic energy boom is expected to benefit KS quite a bit, at least according to some.
On a different matter, on channel 41 news at 6:00 yesterday they reported that the number of business licenses in Kansas was at it's highest level last year.

I listened to a presentation from someone in the Governor's office and he echoed this. They're expecting huge deposits of natural gas in western Kansas to pay off and I think there was a new oil field near Oklahoma maybe they expected to generate some revenue.

I am pretty sure it's the Mississippi Lime formation they would have been talking about. The Mississippi Lime actually is a big deal and, because of it, Kansas probably will be able to get away with their lower taxes. Missouri, on the other hand, presently has oil production of less than a thousand barrels per day.

Eon Blue wrote:Another big factor in Texas' success, along with every other Sun Belt state is it's weather. In "Triumph of the City," the author points to average January temperature as the number one indicator of a city's growth rate over the last 50 years.

Of course, pumping the Mississippi Lime formation dry and burning every bit of that may just bump Kansas' average January temperature into the desirable range...

Brownback's budget includes further reductions in income tax rates, purchased in part by extending a temporary sales tax increase and eliminating the home mortgage interest and real estate deductions.

Anderson said that though sales tax is often called a "regressive" tax that falls more heavily on the poor, "it's only regressive to a certain point."

“The more money you spend, the more sales tax you pay,” Anderson said.

KCMax wrote:

Anderson said that though sales tax is often called a "regressive" tax that falls more heavily on the poor, "it's only regressive to a certain point."

“The more money you spend, the more sales tax you pay,” Anderson said.

KCMax wrote:How does sales tax not apply to food? I have not found this to be the case.

aknowledgeableperson wrote:

KCMax wrote:How does sales tax not apply to food? I have not found this to be the case.

The 'state' sales tax in MO (the 3% portion) does not apply to food purchases, ie can goods, meat and such in grocery stores. When food has been prepared, though, like in a restaurant the sales tax will apply. Local sales taxes are applied to food purchases unless exempted by local jurisdictions.

AJoD wrote:Thanks, pash, interesting description of progressive/regressive/proportional that I hadn't considered in that much detail.

Also, re: KS food sales tax:

http://www.kansas.com/2012/03/18/226102 ... -food.html

Didn't search to see what ultimately happened.

Kansans pay more sales tax on groceries than everyone in the country except residents of Mississippi.

Every year or so, there is a preliminary vote in the Legislature to repeal it, but the effort usually fizzles under the pressures of funding government, or in the case of the last legislative session, cutting other taxes.

During the 2012 session, the Kansas House approved massive tax cuts, which included an amendment by state Rep. Jana Goodman, R-Leavenworth, to remove the state sales tax from food.

But Republicans who supported Gov. Sam Brownback’s desire for individual income tax cuts and eliminating income taxes for owners of 191,000 sole proprietorships, Subchapter S corporations and limited liability companies, quickly jettisoned the proposal to remove the sales tax on food, saying it was too expensive — about $300 million — to be added to the other cuts.