As several GOP presidential candidates embrace the idea of the flat tax, the man who made the idea popular, Steve Forbes
, lauds states for cutting taxes.
"A variety of tax experiments are currently under way that bode well for radical federal tax reform after the 2016 elections," the Forbes Media editor-in-chief writes in an article for Forbes.
Kansas Gov. Sam Brownback, R, pushed through tax cuts two years ago that now "are starting to yield a bumper crop in prosperity," Forbes says.
Ohio Gov. John Kasich, R, "is also hacking away at his state's personal income tax, with an eye to eliminating it altogether, relying instead on broad-based consumption taxes," he writes.
"Even blue states are getting the tax message." Forbes cites Maine as an example.
"Over time states with no income taxes perform better than those with the heaviest burdens: better in economic growth, population growth, job growth, personal income growth and —liberals, please note — government revenue growth," he argues.
"What the states are demonstrating is that simplification and major income tax rate reductions generate prosperity."
Meanwhile, evidence argues strongly against raising taxes on the wealthy to pay for new social programs, says Stephen Moore, an economist at The Heritage Foundation.
"In recent years, blue states such as California, Illinois, Delaware, Connecticut, Hawaii, Maryland and Minnesota . . . raised taxes on their wealthy residents," he writes in The Washington Times
"How did it work out? Almost all of these states lag behind the national average in growth of jobs and incomes."
And these states end up with the worst income inequality too, Moore says. "The blue states that try to lift up the poor with high taxes, high welfare benefits, high minimum wages and other Robin Hood policies tend to be the places where the rich end up the richest and the poor the poorest."
He cites California as an example. "It has the highest tax rates of any state. It has very generous welfare benefits. Many of its cities have a high minimum wage. . . . Yet the state has nearly the highest poverty rate in the nation," Moore explains.
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