The Biggest Tax Increase… and on Whom?
Here’s a point worth restating throughout the current session of the General Assembly (emphasis added):
By broadening the general sales tax and levying a new 1 percent tax, Chafee’s budget would raise about $165 million in new tax revenue — even after taking into account the drop in the general sales tax rate. That would be one of the biggest tax increases in state history — if not the biggest, according to Gary S. Sasse, former state revenue director and now distinguished professor of public policy at Rhode Island College.
Whether Governor Chafee’s manages to improve the state’s ranking when it comes to taxation schemes, his solution to balancing the state’s budget is to raise taxes on a population that’s already heavily taxed. And it’s not a neutral increase; there’s a shift in burden involved. Consider (emphasis added):
Rep. Thomas Winfield, D-Smithfield, said that when he stopped for coffee at Fast Freddie’s, in Greenville, a crowd of angry people objected to applying sales taxes to such a long list of items. When asked how he’d respond to the Fast Freddie’s crowd, [Chafee Director of Administration Richard] Licht said that lowering the sales tax rate from 7 percent to 6 percent would save people money on big-ticket items, so they’d “pay a little more for their haircut but they’ll save on their car.”
Frankly, my family can no longer afford “big-ticket items.” Chafee’s revenue increase, in other words, leverages my basics to subsidize somebody else’s luxuries. Would it be too cynical to discern the policy’s hidden objective as making sure that Rhode Islanders have nowhere to hide from the taxman, even during times of economic hardship?
Yea or nay, the effect is once again that Rhode Island would turn the screw even more tightly on those who are struggling to get by and striving to advance.