Wednesday, March 25, 2015

It's True, Arizona Taxes Screw the Poor. Howie Fischer and WalletHub Say So

Posted By on Wed, Mar 25, 2015 at 4:30 PM

Finally. It's official. The poor in Arizona get screwed on taxes and the rich make out like bandits. Howie Fischer says so, mainly citing a piece on WalletHub. Fischer is right. WalletHub is right. Arizona is a tax haven for the rich and a tax hell for the poor. That means every Republican legislator who complains about high Arizona taxes—in other words, every Republican legislator (If any of you is an exception, please let me know and I'll apologize publicly)—is a liar. They don't give a damn about high taxes on the poor, because, if you're too poor to contribute to campaigns, who the hell cares what happens to you? They just want lower taxes for people who can afford to pay the piper.

In general, WalletHub is a font of half-baked statistics (I mean, it declared Tucson the fifth best city in "Efficient Spending on Education" because we spend so little on schools). But in this case, they got it right, and the Institute on Taxation and Economic Policy, which Fischer also cited, got it even more right in its Distributional Analysis of the Tax Systems in All 50 States. Skip down to page 33 for the Arizona information. Arizona is "#8 of the Terrible 10" when it comes to tax inequality. By its calculations, the top 1 percent pays 4.6 percent of its income on state and local taxes. The bottom 20 percent pays 12.5 percent. (They exclude elderly taxpayers from the study). Here's the graph breaking it down.

If the top 1 percent paid 9.2 percent like the middle fifth pays—I guess it would be too cruel to make them pay as much as the poorest Arizonans, right? — that would bring in another $1.2 billion a year. If the entire top 20 percent paid 9.2 percent, that would generate more like $2.7 billion, which would add almost a third to our current $9.1 billion budget. The state could put back that $99 million it took away from our universities, pay the $317 million the court says it owes to K-12 schools and still have $2.3 billion left over to bring funding for education and social services up to reasonable levels, pave our roads, fix the rest of our infrastructure — you name it. We could even lower the tax burden on the poorest Arizonans and still have money left in the coffers.

The current tax system wages war on the poor. It's time the rich paid their fair share in this state which has been so good to them.

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