Post by Logan on Mar 19, 2016 3:49:59 GMT -6
n meetings with the editorial boards at the Independent Record and Billings Gazette recently, Greg Gianforte, who’s running for governor, has laid out a plan for tax cuts and infrastructure spending that frankly has no basis in reality. Gianforte, a former businessman, is a Republican outsider with no experience in governing, which may explain how he has come up with a proposal that would make a mess out of the state’s budget.
According to Gianforte, the state has a surplus of “almost half a billion dollars.” With that money, he figures, we could eliminate the business equipment tax, which he claims is the “most regressive” tax on the books. We could also adopt one of the income tax measures that failed in the 2015 Legislature. And after both of those tax cuts, Gianforte figures we would have enough left to spend $200 million on infrastructure projects.
Consider Gianforte’s claim that we have a surplus of half a billion dollars. He appears to be referring to the $455 million the state had in the bank at the start of the current biennium. But he doesn’t seem to realize that at the beginning of the next biennium, cash on hand is projected to be $357 million, and it’s only then that Gianforte, if elected, could begin to cut taxes or spend more on infrastructure. So he would be setting his first budget with $98 million less than he thinks.
But it gets worse. Right now, the amount of ongoing revenue the state takes in just about equals the amount that it spends. The budget is currently balanced; there is no surplus or deficit. The money that’s in the bank has been set aside, as a reserve, out of past surpluses. So if Gianforte really did cut taxes and increase spending, the state would run a deficit, and the only way we could pay for it would be by eating up our reserves.
Read more: helenair.com/news/opinion/guest/gianforte-s-tax-plan-would-deplete-state-s-coffers/article_61c3ea4e-9450-5681-8228-1dc40a165111.html
According to Gianforte, the state has a surplus of “almost half a billion dollars.” With that money, he figures, we could eliminate the business equipment tax, which he claims is the “most regressive” tax on the books. We could also adopt one of the income tax measures that failed in the 2015 Legislature. And after both of those tax cuts, Gianforte figures we would have enough left to spend $200 million on infrastructure projects.
Consider Gianforte’s claim that we have a surplus of half a billion dollars. He appears to be referring to the $455 million the state had in the bank at the start of the current biennium. But he doesn’t seem to realize that at the beginning of the next biennium, cash on hand is projected to be $357 million, and it’s only then that Gianforte, if elected, could begin to cut taxes or spend more on infrastructure. So he would be setting his first budget with $98 million less than he thinks.
But it gets worse. Right now, the amount of ongoing revenue the state takes in just about equals the amount that it spends. The budget is currently balanced; there is no surplus or deficit. The money that’s in the bank has been set aside, as a reserve, out of past surpluses. So if Gianforte really did cut taxes and increase spending, the state would run a deficit, and the only way we could pay for it would be by eating up our reserves.
Read more: helenair.com/news/opinion/guest/gianforte-s-tax-plan-would-deplete-state-s-coffers/article_61c3ea4e-9450-5681-8228-1dc40a165111.html