The media's obsession with federal politics can sometimes cloud over state level solutions to our country's fiscal crisis. Occupy Wall Street has created hundreds of forums in nearly every state for concerned people to come together and consider various ways to rebuild the economy. One step to consider is overhauling our state tax systems, and here are five reasons why we should:
- They are regressive. That is, they take a greater share of income from low- and middle-income people than from wealthy people.
- They don't bring in enough money. Most states face deficits year after year because their tax systems don't generate enough revenue to pay for the public services and infrastructure state residents need and want.
- They are filled with special interest loopholes and freebies to the powerful and influential and force the rest of us to pick up the slack.
- They diminish, rather than enhance, economic activity by depending more for revenue on those who are most apt to spend their money in the economy, rather than shelter it to accumulate more.
- They are not transparent. Corporations that benefit from tax breaks often maintain secrecy so the public rarely knows if their tax dollars are being spent wisely.
State tax systems should be progressive, transparent, economically sound and should raise enough money to provide a decent quality of life to all residents. This system overhaul could generate hundreds of billions of dollars to not only wipe out state budget deficits, but also make long-overdue investments in our economy.
Occupy for a fair and progressive state tax system.
For suggestions on how to get from here to there, see UFE's report "Flip It to Fix It."