The governor, who has enlisted supply-side economist Arthur Laffer as an adviser, had proposed lowering and flattening the state’s individual income tax and eliminating taxes on non-wage, business income. But he also proposed paying for those moves by making permanent a temporary sales tax increase that had boosted it to 6.3% from 5.7%, and eliminating a variety of exemptions and credits, including the exemption on mortgage interest and the earned-income credit for the working poor. The governor had pushed for a compromise, but in the end, the legislature, driven by House tea-party conservatives, approved the tax cuts without the revenue components that Mr. Brownback had proposed. “This is what they came up with,” Mr. Brownback said Tuesday. “I’m happy to sign it, and we’re going to make it work.” Still, he added: “I would have put more ‘pay-fors’ in it.” Potential areas for saving include Medicaid and negotiating lower rates for office space and electricity, Mr. Brownback said.
Tax cuts for business and service cuts to the poor…which will somehow stimulate economic activity. This is a “beatings will continue until morale improves” type strategy, which already failed nationwide…so why not try it in Kansas. — Kansas Governor Signs Tax-Cut Bill – WSJ.com http://online.wsj.com/article/SB10001424052702304791704577418641784902500.html