Revenue & Taxation- House

Start with house built one thousand seven and i'm going to run that one and have a vice chairman batty take over from here so give me just a minute. Representative eaves chairman even sir if you're ready your recognized introduce and present your bill thank you. I remember this is the tax cut bill that we've been talking about for quite some time so i'll give a little background arguments all we have two tax tables if you make eighty seven thousand dollars or less you're on one table if you make eighty seven thousand dollars a more you're on another table so what this bill would propose to do is reduce income tax on the personal side by three tenths and it will also reduce and personally corporate income tax by three tenths of a percent so anyone making over twenty four thousand three hundred dollars is going to benefit from this tax cut uhm it'll illegally do this like I said corporate income tax by three tenths of a percent and it will also offer our cansons that make less than ninety thousand dollars a year at one time one hundred and fifty dollars tax credit and for joint filers that would be three hundred dollars and so but i've been seeing and hearing from some is that this benefits only the rich well twenty four thousand dollars I don't think would be considered rich those folks will not only receive the one hundred and fifty dollars tax credit they will also be a beneficiary of the three tenths of a percent reduction on the top rate again twenty four thousand three hundred dollars and up will benefit from this income tax cut so with that i'd be happy to take any questions membership heard the bill there any questions from committee. See no questions is there anyone in the audience it would like to speak okay we do have one is a kitchen smith. If you wouldn't make your way the table and introduce yourself to the committee. Yeah. Yeah. Good morning committee my name is smart I am the executive director for arkansas advocates for children and families also for context I worked for a state government for the past fifteen years and four the last nine and a half I was stepping director for the department of human services and it's with that context that I am testifying against the bill this morning so one of the most important pieces of ensuring that arkansas is a place where every child has a chance to drive and every family has a chance to prosperous ensuring that we have a robust state budget in april the last legislative session individual income taxes were reduced by a hundred and fifteen million a year and corporate taxes by twenty four million so if nothing further is then today our kansas will already pay a hundred and thirty nine million less in taxes this year and so we're asking that you consider not passing these cares cuts because according to the analysis from the institute of on taxation economic policy this tax cut will equally reduce the state budget back two hundred and eleven million and we have emailed our analysis to you all in your you have that in your email box I want to note that several states have surpluses right now and that is primarily due to the federal way that was given during the pandemic and in arkansas our surplus has led me to believe that it's time for additional tax cuts but that raises the question of how are cansons are doing right now so i'd like to ask you to think about whether all of our families are welfared whether we strongly believe that all of our children are well educated and are living in safe and stable housing or affordable housing right now what are the conditions of our roads where is the condition of health care and individuals ability to access it. And can we say that individuals in need of state help can receive services quickly. And of course since I noted that i'm a long term former state employee I will assume if if nothing else from my testimony comes that you please go back home and talk to some of your local your local state employees because folks are dissenting it right now arkansas state employees are responsible for promptly and official efficiently delivering state provided services you all know that state employees investigate child maltreatment and care for foster children they provide direct services and care to our kansas with developmental disabilities and they determine medical medicaid eligibility and much more but there is a hiring freeze right now and there are several government positions that are going and field and as a result state employees are being asked to do the work of two or three people and again that's why i'm asking you to go back and talk to your local constituents that are state employees many of you have already talked to these individuals and you know that they're working extra shifts and dealing with backlogs to address staff shortages these same individuals that not get a cost of living increase this year absolutely none of them received that and some received a mirrored increase and I know this legislature in the governor are looking at reviewing how state employee evaluations will occur next year but there has to be concerned about wind that system is evaluated if it is fair and individuals are effectively evaluated do we have the funds to give individuals that merit pay and the cost of living that they deserve also during the general session early this year there were many bills that you all did not consider because there were concerns about cost there were proposals that could have helped improve access to the quality and a availability of early child care which we know is a critical to arkansas families being able to go to work there were bills that would have helped address the rising cost of diapers and formulas or made will chair accessible vehicles more obtainable we could have expanded medicaid coverage. For new moms to address the states of mormon alarming the terminal matter mortality rate but those things were put on hold and in closing other investments that II hope we can all agree that our state needs to make and this is not a limited list i'm sure you could add to it is the fact that we still need to expand broadband access windy to address food deserts and related hunger issues we need a broaden access to substance abuse services expand community based programs for our kids meet the increasing need for mental health services especially as we're coming out of the pandemic and provide health insurance for uninsured children and i'm sure many more things that we can add to that list and I will close by just saying that the state budget is a reflection of our values if we want our communities to thrive we have to make the economy stronger for every archancer and to do that we need a well funded state budget so I asked that before you pass another tax cut that we really look and take a hard look at what the state budget is funding right now and if we are truly meeting the needs of all our cances thank you so much for your time and we hope you will consider voting now thank you miss mia thank you for your testimony will you entertain questions from the committee absolutely representative wouldn't you recognize for a question you you are aware that this body of the legislature approved a new pay play and instead of forty million dollars to implement there and and we it was designed at a high powers that that wouldn't happen but you are aware I am aware of that sir I am aware of the employees where I you know I would say that II don't know that the news has made it to to all state employees yet but I do think it's still still about the cost of living and lack of mirror pay from the last year but as you know representative because we pack conversations in personnel committee. Um you know a new plan is is great it's about how it's implemented and who actually sees the benefit of it well the good important point in we were trying to make is we see that we've seen the need we see the problem we understood it and we responded to the another decision was my the other place is that impacted then that's the reason they did not get to and like thank you thank you made representative maybe you recognize for a question miss smith there's always I really appreciate you bringing all these really important matters to our attention because they are things that we need a consider when we're looking at the budget as a whole uhm II just want to let you know I am still for the tax cut because we've continued to cut taxes and we have seen surplus grow in and putting money back into every our kensing's hands but my belief is is that you need to keep speaking about all those issues and making sure that we're aware of every decision that we make the needs the true needs that are out there so when we have a four million dollars nearly four million dollar tunnel that's going in we might think twice that maybe we could have met the needs and another way that would have helped more people in our kansas that truly are the most vulnerable interstate I appreciate you take in the time to share this weather's and remind us of why we're here um and I have to ask this in some form of questions so how are you today well i'm i'm glad to be here with you and to talk about the needs of our cansons and representative maybe I appreciate your comment and please know that arkansas advocates will continue to be here to talk about the needs of all of our specifically our children I have a question yes in in your testimony stated a dollar amount of a tax curt that we passed last last session. Yes could you restate that dollar a mail so according to our analysis we will collect a hundred and thirty month nine million less based on the tax cut from april and that's due to a hundred and fifteen million dollar cut for it personal income tax and twenty four million reduced from the corporate tax so bad in addition to the two hundred eleven this time yes that amount would be three hundred and fifty million dollars and tax cuts going back to hard working our kansas in it's just yesterday it is three hundred and fifty million that will go back to our kids and just there is an investment that they can make in their lives and families and the enjoyment pursuit of happiness in this great state I will see that as I will say that that's correct but also and and the sponsor noted that tax cut start as early as twenty four thousand five hundred but if we are taking three tenths of a percentage point from twenty four thousand the benefit for the individual that's making twenty four thousand versus the benefit for the individual that's making six hundred thousand is obviously vastly different i'm sure all our kansas are happy to get a few dollars back but with inflation and the economy right now it's hard to say that the average arkansas which makes about fifty thousand dollars or going to see a lot of money back in their bank account because of this what we'll see now you make me have another question maybe II it may be a smaller dollar a meal but that smaller dollar amount is probably more impactful in the day to day lives of of our our lower earning or cancel the ninety dollars amount that would be for our our higher would you agree with them I would say that an investment in an individuals in the child education if if if I am a average our cans and that speaking fifty thousand dollars if my child can go to a pre k that is facilitated by a state funds and I don't have to pay child care I can less a much health care cost. That would probably be a greater benefit to me than a hundred and twenty dollars but that's just myself and I was a single parent that raised the child here in arkansas and that would just be my perspective I will let that go i'm not more cost but I do appreciate you we could talk more and and about whatever you'd like are there any other questions from the community. Thank you thank you for your time is there anyone else in the audience they would like to speak for against the bill. The. C known representative mister chairman. Would you like to close for your bill he has thank you and I appreciate your comments I want to put this in perspective you know the last ten to twelve years we started out with an income tax rate of over seven percent and we've gradually reduced that I think in a very responsible manner. And every year since we've done that we've had a surplus now we're seeing surpluses in excess of a billion dollars to me that's a clear indication that we're likely overcollecting and so it's time to send some that money back to our constituents but more than that it's it's business owners and and job creators that drive the economy and create jobs for folks back home to be able to pay income tax frankly so if we don't continue to keep arkansas competitive we're going to lose out on those potential jobs just giving you an example and some of the state is quite a little bit old not terribly old that we are completing with states everyone's always familiar with texas and tennessee and in florida with no income tax but as him it's even different we've got states like I would that would be going to three point nine percent very soon we've got indiana that's three point three point seven five mississippi's currently filed they'll be going to four percent and twenty twenty six. So if we don't continue to move organs off down the scale a little bit on income tax we're going to lose our competitive advantage I think we're on the right track I do think we're doing it responsibly and I think you heard a bill yesterday that that created a kind of restricted reserve that if if there was a situation where we perhaps could income taxes too much or the economy has the downturn we have money that will be able to back fill the rsa to make sure that these services that we need to pay for still getting paid for so II completely agree with most everything she said as far as things the state needs to do and I think we're trying to do all that we can but it's important that we remember our constituents back home with that i'm close and i'll make a motion to pass members we have a motion do you pass one of the wishes of the committee all in favor in the opposed congratulations mister chairman your banking is completely members thank you. Yeah. Okay. Okay members are going to move down to senate bill one which I think you heard a little bit about yesterday we will be taking a vote on this one today's representative jean you are recognized to present senate bill one famous chairman college this is a bill that we heard yesterday in committee and had extensive questions on it we just passed the companion bill that we pay a strategy yesterday on the house flower just a while ago this is to create the uh arkansas verifying seven hundred ten million a lot of questions on it yesterday for anything else we need answer i'll be happy to entertain any questions there is any questions representative of maybe you're recognized thank you chair representative blame jean wayne jean i'm get it out I need more coffee I had asked on the house floor how many members are voting members from the house and i'm i'm confused if you could just clarify could you say twenty nine and i'm looking at a large that was sent to us by amber pool and in each cark is the four caucuses that we have there's five members with would that be correct reporting to house member I realize that they're senate but house members that you you have the word I don't pick the budget chair the audit chairs on their automatically they don't act come from the districts the speaker has a couple appointments they can put on there that uh and III was wandering if I was right it's fifty six instead of fifty eight so I voting members though voting because if you're a uhm alternate uh first all out of somebody misses but i'm on there but I don't pick out it i'm on their cables because of the position of chairman of budget audit chairman is owned council because of the position of chair about it. And the speaker has a couple appointments majorily or minority later he tell me all this is we go but anyway there are some that are selected by position and I think you have one more or two positions on thirty percent voucher in spite of maintaining two position okay but II did mispay spoken was fifty six and so twenty eight is voting members **** twenty eight it actually vote on where that money is our sixty members okay but how many are talking about how many actually get to vote on thirty thirty voting members that what you tell you okay so thirty two this number has changed a lot of following members of the house get to actually weigh in in vote on how the surplus money will be spanned in all the other members created they can be there and they can have comment very grateful you allow members to add comment but actually voting it's only that number is that is that correct that's correct and I think it's if if we did have an emergency you your council can come much quicker than calling a special session of an end that is kind of a safeguard you know I have I understand people that want the whole body but I mean II think the safeguard during place every congressional district has representation we all have people that we can count out of to express our II just know that like the the tunnel that I kind of mentioned earlier II was in in support of that but II couldn't weigh in on. That in that that passed legislative will I did it for you so thank you thank you I appreciate that but III just want to make sure that there were all aware and and if this body is is fine with that than than that's fine I just want to make sure we understand it's not the full body that gets to weigh where this money the surplus money gets to go and I understand your concern that that that's all if you all are good with that today that's great I have concerns with it so thank you very much and ask my questions for representative maybe I understand the exercising utility and you making you point just now but you said that you were provided a list of of members of alc could you not have counted those members and counted the number of representatives from the house that were on that committee and for going on this effort that we just went through. A jister yesterday no that's all I mean I need a clarification because as you've heard this number changed the whole bunch of time according to what I had there's twenty of members of alc what I have showed twenty provided a list where you provided the I was provided this list that shows twenty members representative in front and did it not say senator in front of the others this is the list of all see the percent to all of us yes and you saw how often this member changed yes or no I want to clear it on how many people can act and this is not sure how much europe it may be I quit talk to okay let's move on representative of jean di- still the reserve country are talking about that is I know this and you can describe a better than I can but it's restricted to what it can be used for obviously it's going to use to fill holes in rsa if it's needed right right and it'll have to be determined by the chief financial offer and it can Thank you members committee members i'm gonna present senate bill aid for senator dismaying I don't think he's here so it will give me just a moment i'll head down. Miss chairman when you get i'm certainly you're recognized present your bill I members this is the identical bill that we just presented i'm gonna go as far as income tax cuts go nothing's different senate bills with that i'd be happy to take any questions. Any questions from committee. Is there anyone in the audience it will like speak for against the bill. The. See nine representative would you like to close for your bill is there i'm close and make a motion to pass me as we have a motion to pay us all those in favor in the opposed congratulations your biospace. No members that's all we have on the agenda that don't anticipate anything else thank you for your