Mediaboss Marketing

TheNew York Timesrecently reported Republican governors across the country were "bucking the party line" on taxes, citing eight GOP executives proposing tax hikes.Bloombergalso noted the trend of Republican governors and "much-regretted" tax increases earlier this week. However, theWall Street Journaljust heralded "The Tax-Cutting Boon Sweeping the States." So is 2015 the year of reluctant GOP tax hikes or triumphant GOP tax cuts?

The answer depends on the tax. Given budget demands, Republican governors are open to new tax revenueas long as it is never, ever from individual income taxes.

Let's start with the budget challenges. States are generally expected to balance their books, so revenue-losing tax changes must be paired with spending cuts. That's not an easy trade even in the most politically conservative states. Furthermore, as my colleagueNorton Francis reported last week, states are projecting revenue growth significantly below long-term averages, suggesting many governors will struggle simply to meet current needs. No governor wants his or her state to becomethe next Kansas.

So the GOP tax hike talk is real, to an extent. Republican governors in Georgia, South Carolina, and South Dakota proposedand severalothers have discussedsome form ofgas taxincrease this year. RepublicanGov. Rick Snyderis pressing Michigan voters to approve a May ballot initiative that (among other changes) increases gas and sales taxes. GOP governors in Kansas, Nevada, and Ohio want cigarette tax increases. NevadaGov. Brian Sandovalproposed a big business tax hike to pay for his education plan. AlabamaGov. Robert Bentleysays his state desperately needs new tax revenue to fill a budget gapalthough, he won't say what taxes he would raise.

But don't let all this GOP talk of tax increases confuse you. Republican governors are still determined to slash, if not eliminate,state income taxes. The only significant tax change actually signed into law this yearnot counting Michigan's ballot-dependent packagewas Arkansas's income tax cut championed by RepublicanGov. Asa Hutchinson. MississippiGov. Phil Bryantis also considering a considerable income tax cut.

And many GOP governors have proposed tax hikes only to offset income tax cuts:

Other Republican governors are searching for answers to budget problems, but income tax increases are off the table:

Some GOP governors may sign tax increases this year. And spending needs and balanced-budget requirements will rein in the most ambitious tax plansevery year there are far more proposals than actual tax changes. But the overarching state tax story of 2015 for Republican governors is nothing new: avoiding income tax increases at all costs.

The postGOP Governors Flirt with Tax Hikes but Still Wedded to Income Tax Cutsappeared first onTaxVox.

Read the original post:
Why Republican governors are flirting with tax hikes