Where Tax Cuts Are Hot: Jonathan Williams in National Review
Legislators are increasingly realizing that this is a critical juncture for their states: Do we want to be more like Florida and Texas and states that are growing, or do we want to be more like big-spending states like California and New York?
Jonathan Williams, ALEC Executive Vice President of Policy and Chief Economist, was featured in National Review highlighting the importance of tax cuts across the states to promote economic growth agendas.
“Though the idea hasn’t caught on at the federal level, state-level Republicans are “bringing Steve Forbes’s vision for a flat tax into reality,” says Jonathan Williams, chief economist and vice president for policy at the American Legislative Exchange Council (ALEC). Five states — Iowa, Mississippi, Georgia, Arizona, and Idaho — have passed laws to implement a flat tax in the past two years. Arizona’s flat rate is only 2.5 percent. Currently, seven states do not tax individual income at all (Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, and Wyoming). Washington formerly did not tax income but has recently added a tax on high earners’ capital gains. New Hampshire taxes only interest and dividends, but that is set to be phased out under current law, so there will be eight income-tax-free states soon.
Williams points to interstate competition as a driver of reforms: “Legislators are increasingly realizing that this is a critical juncture for their states: Do we want to be more like Florida and Texas and states that are growing, or do we want to be more like big-spending states like California and New York?”
Williams, of ALEC, disagreed with the argument that tax cuts should no longer be a primary part of the conservative economic agenda. “I think it shows how out of touch the people who make that argument are with what’s going on at the conservative grassroots level across the country,” he says. “You may have some of the groupthink going sour on tax cuts, but the overwhelming evidence is the majority of conservative state legislatures are moving in the exact opposite direction. Working in the states now for 20 years, as we’ve seen the factions clearly develop in the Republican Party and in the conservative world at large, I don’t think I’ve seen this kind of unity over an issue like we’ve seen around tax cuts in the last several years.”