So who exactly will Governor McKee’s tax cut help?
If
you were to fall behind on, or simply not pay your taxes, the government will
come after you, and in addition to collecting the money owed, the government
will also assess penalties and interest on the outstanding balance. Classic McKee move. Many of the top dead beats don't live in RI
any more.
In Rhode
Island Governor Daniel McKee‘s proposed 2022 Budget, the interest rate on
taxes owed to the state will be substantially lowered, from 18% to 12%. This
sounds good, because oftentimes, we might imagine, poor people fall behind on
their taxes and some relief would be welcomed.
You
can find this tax break on pages 143 and
144 of the Governor’s tax proposal here.
But in truth, this is a tax break not for struggling families, but for rich tax delinquents. The tax break would be lowered for businesses that failed to remit sales taxes to the state: taxes the business collected when consumers purchased goods and services, but never delivered to the treasury. Also receiving a tax break will be those who have fallen behind on or refused to pay their insurance premium taxes, business taxes and state income taxes.
So
who exactly will Governor McKee’s tax cut help? Fortunately, we know exactly
who because the Rhode Island Division of Taxation publishes a list of
the Top 100
Income Tax Delinquents and a list of the Top 100
Business Tax Delinquents.
You can also see the list of Rhode Island's Top 100 Tax deadbeats in THIS Progressive Charlestown article
Among
those Governor McKee wants to give a tax break to is former candidate for Rhode
Island Governor Giovanni Feroce, who owns over $1.2m, and is listed at his
Newport address, a $4.4m home in Newport. Also on the list are William and Marielle
Reilly whose address is listed at a nearly $600k home in West Palm Beach,
Florida. The Reillys owe in excess of $2m in income tax.
If you are reading this, you are most likely are not on the list of people who owe hundreds of thousands or even millions of dollars to the state. More likely, if you have tax debt of some kind, it has to do with property taxes.
Property
taxes are levied by cities and towns in Rhode Island, and one of the reasons
they are so high is that the state is constantly struggling to provide aid to
municipalities because tax cuts to the rich of the kind being proposed by
Governor McKee in his budget.
In Governor McKee’s recent State of the State address, he advanced the idea that his budget was “fiscally responsible with no broad-based tax increases.” That is only technically true because as the state refuses to collect revenues, and lowers taxes on those most able to pay, starved municipalities will be forced to increase property taxes.
Cutting taxes in one area necessitates one of two things. Increasing
taxes elsewhere, or making cuts to important government services. Governor
McKee and the General Assembly leadership have already publicly declared that
raising taxes on the top one percent of Rhode Islanders is unlikely to happen.
That leaves cutting services.
Governor
McKee’s instincts on tax cuts are pure trickle down bullshit. He seems to
believe that by cutting taxes on the richest, money will trickle down to the
poorest. No real economist believes this anymore (if they ever did) and
policies like this continue to wreak havoc on the economy.
In the video below, Governor McKee evinces support for lowering or eliminating the estate tax, which is literally a tax on dead millionaires. Later in the same video, he proposes, for the first time and long before his budget dropped, the idea of lowering the interest and penalties on tax delinquents.
When UpriseRI
challenged McKee’s use of the word “usury” in the context of these penalties
and taxes, pointing out the payday lenders and credit card companies have equal
or even higher interest rates, Governor McKee replied, with perhaps a touch of
sarcasm “Yeah, those should be gone too.”
This is the second in a series of pieces about Governor Daniel McKee’s proposed 2022 Budget. See also:
Surprise McKee budget item exempts motorcycles from sales tax