Republican Flat Tax is Great. . . If You Make More Than $91,000 a Year
Do You Make Less Than $91,000 a Year?
With great fanfare, Governor Gianforte announced a “public engagement campaign” to promote a “flat income tax” in Montana. The idea is simple: Republicans want to eliminate our current multi-tiered income tax and replace it with one 4.7% rate for everyone, regardless of their income.
The result of this proposal is a big income-tax break for wealthy taxpayers and a big, fat nothing for you if you make less than $91,000 per year. Same old trickle-down BS.
Understanding the Relative Value of a Dollar
The concept of a flat tax sounds good. Everyone ends up paying the same rate regardless of their income. Sounds fair, right?
It’s not.
Economists use the term “marginal utility” to explain the fact that one dollar is worth more or less to individuals depending on their income. Put bluntly, it refers to the fact that very wealthy people do not value a dollar the same way a person farther down the income scale does.
Business Insider actually crunched the numbers and found that the value of one dollar for an average American equates to $1,355 for the average billionaire.
Most people understand that wealthy people often don’t count their pennies like the rest of us. Of course not. They don’t have to worry about it.
Think about the last time you made a major purchase. Most of us start by deciding what we can afford. Imagine how different it would be if you didn’t have to worry about the price.
Outside Groups to Run the Montana “Public Engagement Campaign” for a Flat Tax
Standing next to Governor Gianforte at the press event announcing the campaign to promote the flat tax were Jack Baum from the D.C.-based group Americans for Tax Reform and Chris Cargill, president of the Idaho-based group Mountain States Policy Center. Both groups are part of a national network of right-wing organizations promoting a menu of “economic reforms.”
Americans for Tax Reform was founded by Grover Norquist, who is currently president of the group. Norquist is probably best known for a comment he made in 2001. He told a reporter, “I don’t want to abolish government. I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub.”
Mountain States Policy Center is based in Idaho. It is a member of a national group called the State Policy Network (SPN). A report by the Center for Media and Democracy found that the group had a budget of $152 million in 2022.
The State Policy Network claims to be nonpartisan and independent. But it is funded by the Koch brothers and other right-wing funders. The group is also a major driver of the American Legislative Exchange Council (ALEC), which develops model legislation to implement right-wing policies and disseminates them to state legislators and lobbyists.
The Mountain States Policy Center appears occasionally on Montana editorial pages, promoting its version of free-market economics and public policy.
Former Montana Law School professor Rob Natelson is listed as one of the organization’s “research fellows.” He authored a report recommending that Montana hold a constitutional convention because he believes there are flaws in our current constitution.
Natelson has a long and controversial history in Montana. He left the University of Montana Law School under a cloud of controversy. He was unpopular with his colleagues, who voted to deny him emeritus status. He also sued the law school, alleging that he had been discriminated against because of his conservative views.
In 1996, Natelson ran for governor against Marc Racicot in the Republican primary. He received less than 25% of the vote. In 2000, he ran again and was defeated by Judy Martz in the Republican primary.
Flat Tax Likely to Be Center Stage in the Next Legislature
The Gianforte administration and its out-of-state hired guns are clearly setting the stage for the next legislature.
If you make less than $91,000 a year, the proposal offers you nothing but the continued shoveling of money into the pockets of the people at the top of the income ladder.
