Income Tax Reform · Install a graduated tax code: 1. 0-29,999 (0%) 1/5 of state 2. 30,000-99,999 (5%) 3/5 of state 3. 100,000+ (7%) 1/5 of state · These reforms alone would generate an extra $800 million. · 80% of Alabama families would either have their income taxes cut, or remain the same · Flexible. We only want to have the 7% rate exist for the first 2-3 years of our Alabamian Revival Act. We realize that the state is at a huge crossroads and that we need to deeply re-invest in the state to fix the $-563 million structural deficit. We also want to continue to celebrate our relatively low tax rates in the state. After the 3 years of a 7% tax rate, it will be lowered to 6%. This still would bring in an extra $400million compared to the old system. This alone could almost solve the structural deficit. · All stats from the plan and setting the rates of taxes come from my income tax research group of my cabinet. They received their information from a variety of sources, but mainly the 2010 census Sales Tax Reform · Get rid of the grocery tax (Cost $30 Million without any change to sales tax. This would be made up for the new revenue in the income tax arena.) · OR—A change in sales tax could occur: · 4.5% would have us breaking even, but 4.25% would be easier for tax payers to accept (Still cost $15 Million). Boy’s State Accepted 4.5% sales tax. Property Tax Reform · Change the property tax from 42 mils to 44 mils · Even if we were to double the property tax, we would still be the lowest in the nation · Separate family farms and small businesses from the same taxation group as huge corporations. When this is achieved, cut the taxes of family farms and small businesses · Even with cutting family farm taxes in half, we would be able to generate an extra $109 million to the general fund Excise Tax Reform · Changes in the sin tax on: 1. Beer: +5 cents (per gallon) 2. Liquor: +10 cents (per gallon) 3. Cigarettes: +29 cents · A new $101 million to the general fund · All rates are still lower than surrounding states in these categories (except MS for cigarettes) to ensure that people won’t do as they did in DC and Chicago and go to border states to buy the products cheaper. · A very, very, very, small percentage of the state would be able to drive to MS to actually make money or break even from buying cigarettes there, because of the money they would spend on gas Medicaid Crackdown · Create a crackdown/watchdog group to stop abuses · We spend 5 Billion on Medicaid each year · By creating a system similar to Florida’s successful system, we could save up to $80-120 million annually on Medicaid fraud. The costs of employing all involved in the system would be 2-3 million a year. The building of facilities and maintaining them annually would be about 3 million dollars Income tax Income Tax: Worst: +400 Million Best: +800 Million Sales Tax : Worst: -30 Million Best: Even Property Tax: Best: $109 Million and up Excise Tax: Best: $101 Million Medicaid Crackdown: Best Range: $80-120 Million Overall: Best: $1.1 Billion Worst: $660 Million Either one SOLVES the $-563 Million Deficit of the general fund Also passed with the budget:: EducationHighly taxed and highly regulated gambling would also generate $700 million to the education budget. We got these stats by adopting the GA lottery structure, in relation to how many people above the age of 18 that we could expect to play the lottery or gamble at a casino |
