Tuesday, October 26, 2010

Competition Among States: Race to the Bottom

Attention Arizona voters:

Cutting State Corporate Income Taxes Is Unlikely to Create Many Jobs

"Corporate income taxes are important sources of revenue that states use to fund public services, including services essential to long-term economic growth like education, infrastructure, health care, and public safety.
Nonetheless, a number of 2010 [ Republican ] gubernatorial candidates have made corporate tax cuts key planks of their campaign platforms. This continues a trend of the past couple of years, during which policymakers in several states have proposed cutting corporate income tax rates — or even eliminating the tax completely — as a strategy for stimulating economic growth and creating jobs. These proposals, however, offer false hope. Corporate income tax cuts are unlikely to have a positive impact on a state’s rate of economic growth or the pace at which it generates private-sector jobs. "

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