Kansas Republicans raise taxes, ending their GOP governor’s ‘real live experiment’ in conservative policy – The Washington Post

Gov. Sam Brownback vetoes a tax bill in February. (Thad Allton /The Topeka Capital-Journal via AP)

Republicans in Kansas broke ranks with the state’s conservative governor Tuesday night, voting to raise tax rates and put an end to a series of cuts.

The GOP revolt is a defeat for Gov. Sam Brownback, who overhauled the state’s tax system beginning in 2012, bringing down rates and causing repeated, severe budgetary shortfalls.

Kansas’s legislature is overwhelmingly Republican, but moderate GOP lawmakers joined with Democrats, overriding Brownback’s veto of a bill they’d already passed once that would raise taxes again by $600 million a year. Eighteen of the state’s 31 GOP senators and 49 of the 85 Republican members of the House voted against the governor.

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The victory for Brownback’s opponents resulted in part from their gains in last year’s election. Voters — frustrated that public schools were closing early and the state’s highways were in visible disrepair — rejected Brownback’s allies in favor of more moderate Republicans or Democrats.

“It was a hard vote for a lot of people to make last night,” said Rep. Melissa Rooker, a moderate Republican who represents a suburb of Kansas City. “Kansas has had a turn to the far right, and we seem to be centering ourselves.”

The legislation undoes the essential components of Brownback’s reforms, which he famously described as part of a “real-live experiment” in conservative governance.

Brownback had reduced the number of brackets for the state’s marginal rates on income from three to two. The legislature will restore the third bracket, increasing taxes on the state’s wealthiest residents from 4.6 percent to 5.2 percent this year and 5.7 percent next year.

Marginal rates on less affluent Kansan households will increase as well, from 4.6 percent to 5.25 percent by next year for married taxpayers making between $30,000 and $60,000 a year and from 2.7 percent to 3.1 percent for those earning less than that.

Play Video 1:04

Gov. Brownback calls for government to scale back taxes and regulations

Kansas Gov. Sam Brownback (R) spoke at the 2017 Conservative Political Action Conference on Feb. 23, and pushed for less government regulations. “When have we added more government anywhere that’s taken more taxes and you end up with a product that’s more efficient that costs you less?” he asked. “What’s your example?” (The Washington Post)

The legislation also scraps a plan to bring those rates down even further in future years, one of Brownback’s promises to conservative supporters.

Finally, the legislature eliminated a cut Brownback had put in place to help small businesses. Analysts said that the provision had become a loophole, as many Kansans were able to avoid paying taxes entirely by pretending to be small businesses.

Initially, the state forecast that about 200,000 small businesses would take advantage of the break. As it turned out, about 330,000 entities would use Kansas’s new rule. That discrepancy suggests that tens of thousands of workers claimed that their incomes were from businesses they owned rather than from salaries.

“What we were able to do in the last 24 hours can allow us to start down that road, to begin repairing all the damage done after living with Gov. Brownback’s failed tax experiment for five years,” said Annie McKay, who is the president of Kansas Action for Children, an advocacy group in Topeka.

Tuesday’s vote was a rebuke not only for Brownback, but also for Republicans in Washington who have advocated similar cuts in taxes at the national level — including President Trump.

Play Video 2:42

Trump’s tax plan, in 3 minutes

The Trump administration unveiled their proposal to overhaul the tax code on April 26, outlining sharply lower tax rates but fewer tax breaks. (Video: Jenny Starrs/Photo: Jabin Botsford/The Washington Post)

The principles that Trump endorsed during the campaign and that he has stated again since becoming president are broadly similar to those enacted in Kansas. As Brownback did, Trump proposed reducing rates, reducing the number of brackets and allowing small businesses to pay a reduced rate.

That is no coincidence, since Brownback is well connected to the Republican policymaking establishment in Washington. Trump and Brownback have shared economic advisers, and when Brownback was a U.S. senator, Rep. Paul D. Ryan (R-Wis.), now the speaker of the House, served as his legislative director.

Proponents have argued that reducing taxes will stimulate the economy. “We have worked hard in Kansas to move our tax policy to a pro-growth orientation,” Brownback said in a statement on vetoing the legislation. “This bill undoes much of that progress. It will substantially damage job creation and leave our citizens poorer in the future.”

Since 2012, however, the pace of economic expansion in Kansas has consistently lagged behind that of the rest of the country.

Last year, Kansas’s gross domestic product increased just 0.2 percent, federal data show, compared to 1.6 percent nationally. That was an improvement for Kansas, though: At the end of 2015, the state was in what many economists would describe as a recession, with the economy contracting two quarters in a row.

Last year’s election substantially weakened Brownback’s support in the legislature. In November, Democrats picked up a seat in the Senate, which has 40 members, and 12 seats in the House, which has 125. In primary elections in August, Republican voters had forced out 14 incumbent allies of the governor, replacing them with more moderate candidates.

Other GOP lawmakers who supported Brownback retired last year, and moderate Republicans won a few of those seats as well. Rooker, the GOP legislator, said her former colleagues were not eager to confront frustrated voters in another campaign, or to deal with the fiscal headaches Brownback’s policies had created if they did win reelection.

The legislature began this year’s session with the government in a deficit of $350 million.

“People expect us to take care of business efficiently and appropriately,” Rooker said. “I just think it was the pressure building. Something had to be done.”

“The elections reflected a mood in Kansas that possibly Kansas politics had shifted too far to the right,” said Rep. Don Hineman, a moderate Republican who represents a rural district in western Kansas. “It was time to return to a more centrist position, which is where Kansas has traditionally been governed from.”

For the past several years, legislative sessions have been protracted as lawmakers have struggled to find solutions to the state’s fiscal woes. That pattern continued this year, and Hineman hopes that with the tax increase enacted, lawmakers can finally leave Topeka this weekend.

On Saturday, he hopes to head back to his family’s farm, which his son operates. This week, they are putting in grain sorghum. “I’m anxious to get back home, and my son is anxious for me to be home, because he would like to have me on the tractor,” Hineman said.

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