Ohio Governor wants to copy Kansas’ Disastrous Tax Cut Strategy
Ohio Gov. John Kasich (R) wants to mimic a tax cut experiment that has already brought fiscal calamity and public service cuts to a state 600 miles west of his.
Kasich describes his $696 million tax cut as a helping hand to small businesses. But the design of the cut would put the bulk of that benefit into the hands of just a few high-income business entities with a handful of employees while providing just a few hundred dollars each to the vast majority of the people who would benefit, according to an analysis by the Cleveland Plain Dealer. For nine out of every 10 companies that would benefit from the Kasich cut, the total yearly savings would be $364 or even less.
For the remaining 10 percent of companies affected, savings could be as high as $8,000 a year, a number that Kasich administration officials acknowledge is far too low to create even a single job per company. Instead of pitching the cut as a direct job creator, the officials are marketing it as an “every little bit helps” move for hardworking entrepreneurs.
The problem with such a move is that it doesn’t effectively target actual small-scale business enterprises that hire people and generate economic activity. The kinds of small businesses that politicians usually talk about would also benefit from the move, but the way the cut is designed means it would also be available to many business entities that are organized under small business sections of the tax code, but which do not operate as traditional commercial enterprises. Savvy individuals can structure their personal revenue streams under the business tax code using what are called “pass-through entities,” and then take advantage of preferential tax treatment like what Kasich is proposing.
Three-quarters of all tax entities organized as “small businesses” employ no one other than the owner. Just 11 percent of all taxpayers who report business income are small business owners with actual employees.
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http://thinkprogress.org/economy/2015/02/12/3622262/ohio-small-business-tax-cut-kansas/
The latest scam by the greedy MF'ers
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