Co-author Jonathan Williams joined John Hendrickson of the Tax Education Foundation of Iowa in an op-ed for the Des Moines Register, refuting many myths of the Kansas tax reform story and detailing how Iowa’s tax reforms will work when combined with sensible budget reforms.
The real lesson to be learned from Kansas’ experience, or with any tax reform, is that spending must be prioritized. As financial management 101 reminds us: Increasing spending, along with cutting taxes will lead to a budget shortfall. This is what occurred in Kansas when the Legislature increased spending by more than $430 million in the same year it cut taxes. It is imperative that policymakers look at ways to reduce costs, eliminate waste and prioritize government spending when considering lowering tax rates.