Wednesday Column Reprise
Note from Dan: While I’m on vacation, I’m treating you to some oldie-but-goodie columns from the past. This one originally ran Jan. 5. It looks at why the Republican-controlled Virginia state government doesn’t follow its own dogma regarding tax cuts, and concludes that’s because even they don’t believe it.
Welcome to 2012. In this new year, we have a new Virginia General Assembly, controlled by Republicans. And they have an exciting opportunity to boldly go where no legislature has gone before.
For decades, conservatives have told us the only surefire way to both grow jobs and boost government revenue is to cut taxes.
Their argument works like this: The fewer taxes a government imposes, the more of their own money consumers keep. They spend it at businesses, which grow at a faster rate. Thus, lower taxation results in more government revenue because of all that new consumer spending and business expansion.
The 2012 Virginia General Assembly can once and for all prove that dogma true. Our GOP-controlled legislature can slash state taxes, and our Republican governor can sign those bills. Unlike past years, there are few if any ways Democrats could stymie this grand experiment.
Take for example the state sales tax — it’s 5 percent. It produced $3.01 billion in revenue during fiscal 2011. Slash the rate in half, and how much would revenue increase?
That’s hard to say, but such a dramatic cut such ought to produce dramatic results, according to tax-cut dogma. If the conservatives are correct, the tax cut would cause Virginians to launch a consumer-spending spree.
READ THE REST OF THIS COLUMN HERE.