Come to Rhode Island! (We’ll Take Your Money.)
Even without taking up the debate about Rhode Island’s flat tax, a press release announcing legislation to eliminate it, sponsored by Rep. Helio Melo (D, East Providence), illustrates why Rhode Island’s economy will go nowhere until there’s massive turnover in the state house:
“The flat-tax was championed as a way to attract employers to our state, but it’s really more of a no-strings-attached gift to the fortunate few who just happen to be very well-off,” said Representative Melo, a Democrat who represents District 64 in East Providence. “That’s certainly not real tax relief to our citizens, the majority of whom are working people struggling to pay their bills. If one group gets a tax cut, that money has to be made up somewhere, and the result is that it’s deepening our state’s deficit and creating more of a burden for us all to pay. We all keep hearing that taxes will have to increase. Does that mean more taxes for the working-class people in my district while the high-income people get tax cuts? I don’t think so.”
If you were evaluating locations in which to invest your life to build a business, would you be comfortable choosing a state in which legislators believe that the rewards of your labor would be something that “just happened”?
If Mr. Melo wishes to help his working-class constituents, he should advocate for lightened tax burdens all around, compensating for potential losses of revenue by cutting government expenditures. Rhode Island’s politicians would rather play ideological games than get results.