Grant Bosse Is Right About Income Tax Amendment
Tuesday, January 24, 2012 at 03:03PM I could not have said it better myself than Grant Bosse did although in fact, I did try to say it (despite being interrupted by His Vileness and silenced by the despotic Speaker) during the debate last week on CACR13, the bill which would enshrine anti-income tax language in the New Hampshire constitution. Therefore, with permission, I'm reprinting Bosse's op-ed piece which ran in the Concord Monitor over the weekend.
He makes three of the points I attempted to make (before I was silenced by His Vileness and The Despot)--that we shouldn't be legislating in the Constitution; that having the income tax is a good election issue for Republicans; and that it's not likely to achieve the 66.7 percent necessary to pass.
Note that the headline, a takeoff of the subtitle of the Dr. Strangelove movie, is rather clever as well.
Thumbs up to Grant Bosse and to The Monitor for publishing these wise words; it's always reassuring (although not dispositive) to have someone as wise as Grant Bosse and the Josiah Bartlett Center on the same page.
How I learned to stop worrying and love the income tax
By Grant Bosse
FOR THE MONITOR
Let me reassure my friends and critics alike: an income tax is a really bad idea. It’s an especially bad for New Hampshire, which has established a competitive advantage in large part by avoiding broad-based sales or income taxes.
But even the most ardent opponent of the income tax should think carefully about placing a ban on it in the New Hampshire Constitution.
Last week, the New Hampshire House approved CACR 13 by a vote of 257-101. If approved by 15 Senators, the amendment will go on the November ballot asking New Hampshire voters to approve the following addition to the Constitution:
“No new tax shall be levied upon a person’s income, from whatever source it is derived.”
Here, here! This simple wording has some benefits. It clearly tells voters what they’d be approving, and it avoids the problems created by an earlier draft banning taxes “directly or indirectly” on income. Just about any change to the tax code could be seen as an indirect tax on income, leaving jurisdiction over tax policy in the courts. And we’ve seen what a great job they’ve done with our schools over the past decade.
Banning an income tax would be frowned upon by the nation’s three big bond rating agencies, which view broad-based taxes as New Hampshire’s ultimate defense from defaulting on its debt. Think of it as the Granite State Airbag. You never want to use it, but they feel better knowing it’s there. I consider this a relatively minor objection to the amendment, since the assurance an income-tax ban would give businesses looking to locate in New Hampshire would more than outweigh any uneasiness at Moody’s.
There’s also the principled objection over writing specific policies into the New Hampshire Constitution, limiting the flexibility of future Legislatures to make the best decisions for their time. Any lawmaker making this case is employing the technique described recently by Speaker Gingrich as “pious baloney”. Every politician would love to carve his priorities in stone rather than sand.
So let’s get to the real reason why income tax haters should oppose this amendment; politics. If this amendment were to pass, tax fighters would lose their strongest and more reliable weapon against their tax-and-spend opponents.
About once a decade, New Hampshire Democrats climb out from behind their protective shield to nominate a candidate in favor of an income tax. That candidate gets trounced, and Jeanne Shaheen and John Lynch keep taking The Pledge. Republicans hoping to hold on to power should cherish the enormous advantage that the threat of an income tax gives them.
Likewise, cynical Democrats should do everything they can to get the Amendment though. Without pledge politics dividing their primaries and dooming their more liberal nominees, they would win more elections.
Of course, most New Hampshire politicians are motivated by more than electoral success. They run for office in order to implement their policy ideas. Most Republicans would sacrifice a few elections if it meant New Hampshire would never have a broad-based income tax. And most Democrats would suffer a few more years in the wilderness in order to preserve their dreams of tax fairness, however they define it.
Ultimately, the income tax amendment probably isn’t going to make it into the Constitution. As my boss, Charlie Arlinghaus, points out; it’s hard to get 67% of voters to approve a ban on income taxes in a state where Mark Fernald and Arnie Arnesen each got 40% of the vote running on a pro-income tax platform.
Putting CACR 13 on the ballot this fall likely won’t keep New Hampshire from ever adopting an income tax. But it will ensure that every candidate for office will be talking about the income tax. And most voters will have the income tax on their minds when they go to the polls. As an ardent opponent of the income tax, I wish it were that way every year.
Grant Bosse is Lead Investigator for the Josiah Bartlett Center for Public Policy, a free-market think tank based in Concord, NH.
Reader Comments (3)
That said, I would be equally o.k. with the sausage-makers outlawing real-estate taxes; potato, potatoe.
– C. dog regurgitates meat byproduct to feed the chil'ren
Wasn't that from that dreadful ode we had to memorize in high school?
– C. dog