Don't Go Changing, to Try and Please... Special Interests

The Rhode Island Public Expenditure Council (RIPEC) makes a point that ought to be raised every time the progressives put forward data purporting to illustrate the lack of effect of recent tax cuts:

Estimating that taxpayers already are kicking in an average of 12.3 percent of their income to finance state and local government, the Rhode Island Public Expenditure Council urges that Governor Carcieri and the legislature be wary of making any sudden changes in the tax structure as a quick fix for the looming budget crisis.

"Before any changes to the tax structure are made, they ought to be analyzed in a fair amount of detail," said John C. Simmons, executive director of the business-backed organization that studies public fiscal matters.

"We're saying you have to do this in a thoughtful way," especially, he said, because the legislature has made changes to the tax code in recent years and it will take some time to gauge their effects.

One change is the flat tax option passed by the General Assembly in 2006. Another reduced the capital gains tax on assets held more than five years.

"Those changes are just starting to hit," Simmons said.

RIPEC puts our tax burden at 7th highest in the nation, with special emphasis on taxes that are particularly harmful to the business environment (general business and sales).