The idea of putting the burden and consequences of Frankfort's horrendous financial mismanagement is poorly conceived, ill-timed and completely unfair. Why should a small group (approx. 29 percent of Kentuckians) bear the weight of government largess, especially when studies show that many of those Kentuckians are low income?
The stunning and contradictory answer to this question comes from left-minded leaders who think it would be a good idea to both raise revenue and change behavior at the same time. In essence, their argument contradicts itself because they are trying to accomplish two diametrically opposed goals - like trying to defend oneself from an attacker by hitting oneself with a baseball bat.
The root of the problem
Increasing the cigarette tax is unfair, because it saddles a small segment of our society with the burden of taking care of the rest. What about their financial crisis? Why not institute a fat tax on cheeseburgers, or increase the alcohol tax?
It is also a bad idea because it doesn't address the root issues of Kentucky's problem. First, raising the cigarette tax will do absolutely nothing to lower Kentucky's dismal unemployment rate. (Just over 7 percent) How many jobs will be created by raising this tax? Even if the state can raise revenue temporarily until people quit smoking, they cannot depend on this as a steady stream of revenue.
Second, raising the cigarette tax does absolutely nothing to change Kentucky's unfriendly business atmosphere and profit squashing tax code. We cannot expect unemployment to subside in Kentucky until we can attract new businesses that bring with them high paying jobs and until we begin to encourage entrepreneurship without taking away its rewards.
There is a solution. It's House Bill 51, (learn more at KYvotes.org) and it will eliminate Kentucky's income tax on individuals and businesses. It makes up the revenue by adding a sales tax to certain services that are not currently taxed, but it lowers the overall sales tax rate to 5.5 percent while still exempting items like groceries and most medical supplies and medicines.
Currently, Kentuckians pay a 5 percent income tax. If you make $50,000 a year, that's $2,500 cash back in your pocket, not counting the savings on the lower sales tax. This bill, pre-filed by Rep. Bill Farmer and co-sponsored by Rep. Stan Lee is a real solution.
While many other states are begging for bailouts and raising taxes on everything under the sun, Kentucky could be building its future.
Leland Conway is the executive editor and co-founder of www.conservativeedge.com and the host of the Pulse of Lexington on News Radio 630 WLAP.
