Tag Archives: GOP

North Carolina GOP – Welfare Reform

In what is looking like is going to turn into a trend, the North Carolina GOP feels emboldened by their recent ass-whipping of the democrats in 2012.  The next target in their sites?

Welfare reform:

State lawmakers are discussing draft legislation that would prohibit lottery retailers from knowingly selling tickets to customers who receive public assistance, such as food stamps, or are in bankruptcy, Pat Gannon at the Insider reports. “We’re giving them welfare to help them live, and yet by selling them a ticket, we’re taking away their money that is there to provide them the barest of necessities,” said Rep. Paul “Skip” Stam, R-Wake. He acknowledged it would be difficult for lottery clerks to know whether players get government help. But he suggested that in obvious cases, such as when customers pay for groceries with food stamps, they shouldn’t be allowed to buy lottery tickets at the same time.

So, there’s a bit to think through here, the first of which is this:

Is it really the role of a government to dictate how people spend their money?  Is not a grown adult able to make a decision to spend their money in any way and manner that they desire?

I don’t wanna bring up whether or not government CAN do this, after all, if New York City can ban large sodas, so then can the state of North Carolina ban the sale of lottery tickets.

So yes, the government can, but should they?  I, personally don’t think so.  Not that I don’t resonate with the whole, “They shouldn’t play the lottery” thang – they shouldn’t:

Combining the players making less than $25,000 per year we see that just about HALF of the population plays the lottery. Further, those people who play are spending near $600 a year! This means that these players have near $600 of annual disposable income that they are choosing to spend on the lottery.

The law maker is right, folks who don’t have money have no business spending money on a system that is, in essence, a tax on the mathematically challenged.  However, we don’t live in a world, or at least we don’t wanna live inn a world, where we need our government to protect us from every. single. bad. decision. there is to make.

The last point I wanna make is concerning the lottery itself.  I get the impression that state run lotteries are the domain of the democrats.  That, typically, republicans are against the lottery.  Which begs the question, how can a caucus that rages against class inequality support a system that takes money from the general public, aggregate it, and then give an amount of money to an individual that places them in not only the top 1%, but the top .01%?



North Carolina GOP – Tax Reform

The GOP didn’t do so well at the national level in the 2012 elections.  However, here in North Carolina, the GOP cleaned house.  Not only did North Carolina break for Romney, the only battle ground state to do so, but they elected a republican governor  for the first time in 20 years.  In fact, including this current governor, there have been only 3 republicans in the mansion since 1901, well over 100 years.

Further, the GOP extended their majority in both the state house and senate.  Those majorities are now so wide that the republicans can propose and send to the ballot box amendments to the constitution without a single democrat voting with them.

I don’t think that such dominance is healthy, either way – democrat or republican.  So it isn’t a surprise that one of the first things on the agenda is tax reform:

RALEIGH — Republican lawmakers outlined a proposal Wednesday to revamp the state’s tax system, offering a slew of reforms that would radically shift the tax burden in North Carolina.

The proposal would eliminate personal and corporate income taxes in exchange for higher state sales taxes levied against groceries, medical expenses and other currently tax-free services.

I suspect that this is going to go over like a lead balloon.  So it shouldn’t be a surprise that opposition is already forming:

The N.C. Budget Center, a liberal think tank, conducted a simulation analysis that suggested more than half of taxpayers, particularly the middle and lower class, would see their overall tax burden rise, while the most wealthy would get a significant cut.

Now, I’m not as familiar with the state numbers as I am the familiar national numbers as they pertain to who pays and who doesn’t pay state income tax.  And while I am sympathetic to the argument that an increased sales tax would hit the lower and middle class harder, I am not as sympathetic to an argument that takes a citizen from paying no tax to having some burden to the state.

With that said, I do agree with “Friend of Tarheel” Dave Ribar when he claims:

But critics caution that the proposals represent a fundamental change in who pays the state’s tax burden, and economists said that low-income people would feel the brunt. “For this particular proposal, the responsibility would shift from rich households and prosperous corporations to poor households and smaller businesses,” Dave Ribar, a professor at UNC-Greensboro, concluded in his analysis of the proposal.

North Carolina funds its budget through various taxes working in balance.  While we have high income taxes and corporate taxes, we have a lower sales tax combined with a very inexpensive tax on housing.  Further, our gasoline tax is high compared to our region.

So, while I get the republican’s desire to change the income tax and corporate tax scheme, I’m afraid that they aren’t going to take the whole picture into account and maybe, just maybe, make the whole thing worse.

Here are the details released so far:

It costs roughly $12 billion to eliminate the corporate and personal income taxes and business franchise taxes, as the GOP proposes. The money accounts for more than half the state’s $20 billion annual budget.

Proposed tax hikes

To offset the cuts, Senate Republicans are considering:

• Eliminating all 318 existing tax breaks in the state’s tax code, which account for $9 billion in revenue. The breaks cover everything from motor vehicle taxes to prescription drugs and insulin to sales taxes paid by nonprofits.

• Generating $12.9 billion in new revenue by increasing the 6.75 percent combined sales tax rate levied in most of the state to an 8.05 percent combined state and local tax rate.

The higher rate would apply to all goods and services – including those currently exempt from taxes, such as lottery tickets, haircuts, dentist visits, housekeeping and lawyers’ fees.

One major increase would be the sales tax on groceries. It currently sits at 2 percent but would increase to 8 percent.

Together, the sale tax changes would provide $12.9 billion.

• Levying a 1.05 percent tax on businesses, indexed to either net worth or gross receipts. Republicans are calling this a “license fee” that would produce $4 billion.

• Increasing the tax on all commercial and residential real estate sales, from the current 0.2 percent rate to 1 percent, generating $400 million.

Expect much hand wringing to take place.