Cutting taxes starves public services

Looking at the tax cut proposals now being debated in the legislature, maybe it’s time to revert back to a territory. Apparently, we don’t want the state to accept the responsibilities of providing minimum support for public services.

States are supposed to be communities with common interests. In North Dakota, it seems like frontier thinking of starving the public to benefit individuals prevails in the legislature. The tax cuts being proposed will do nothing to raise the quality of roads, education, health, etc..

Two competing tax cut proposals are on the legislative table. The governor wants to cut the income tax but key legislators want to cut property taxes. Neither tax is onerous – in fact, North Dakota is a low tax state.

With our present income tax already lower than most other states, cutting the tax now makes no sense. The arguments offered by those favoring income tax are groundless. It is not based on facts but on a yen to starve human services.

The governor said the primary reason for cutting the income tax is to attract a workforce. Yet, no concrete information was offered to measure the significance of the income tax to potential workers.

In the first place, the workforce needs some business for which to work. If we had jobs, they would come but we are short on job creation. To be honest, it is the federal government and outside developers that are providing the present prosperity.

It is an old myth that low taxes have some kind of influence when attracting new business. Looking to the east, Minnesota is a high tax state – and higher quality services – and the state is booming. I've been hearing this myth for over 50 years and we are still on square one. If taxes were a factor, all of those businesses in the Twin Cities would be fighting to get into North Dakota.

The quality of life is better in Minnesota because it is a state in which the word “community” is translated into caring for people. Anything that looks like compassion in North Dakota has been on the back burner since the beginning.

Rep. SuAnn Olson (R-Burleigh) a CPA, seems to be one of a few who see that these tax cuts would not be the silver bullet for jobs. She doubts that the income tax reduction would attract workers. Besides, she hasn’t heard a public demand for income tax relief.

Then there is the proposal to cut property taxes. The state gets nothing from property taxes – it all goes to local governments – counties, cities, schools and townships.

Under Sen. Don Schaible’s plan, the state would reimburse school districts $327 million for the loss of the property tax. While we could argue over whether or not the property tax ought to be cut, the gold in the proposal is shifting more education costs to the state level.

At the present time, education finances are in royal mess with uneven support from school district to school district. Every session of the legislature has just patched the per-existing system without trying to inject a sense of fairness for all students no matter where they live in the state.

In 1980, the state went to a property tax system using productivity rather than market value. This resulted in a 50 percent property tax cut for farmers. That was 40 years ago. Maybe it is time for professional agriculture economics people to revisit the impact.

Nobody has been proposing a cut in the sales tax. That would relieve the working families in our regressive tax system more than an income tax that would benefit the wealthy the most.

If we cut all taxes we would not see a rush of job-seekers. We would still be NORTH Dakota.