It should be apparent to every citizen by now that the decision to adopt the LOIT tax or not is being treated as an emotional one. If one can claim that those in favor of the tax are being called greedy, unfortunately, those not in favor of the LOIT tax are being labeled as unfair and uncaring. Putting emotions aside briefly, what we really need is someone who actually knows the real budget numbers, can take a look at them, analyze where money is being wasted and make cuts and then decide what is really needed and make some decision about whether taxes should be increased and by how much. Emotions aside, this is not being done and that is what we are paying our County Council to do. Meanwhile, as we shoot passionate letters back and forth in the newspaper, most citizens don’t actually know what to believe. Perhaps a little history lesson would be appropriate.
Our elected members of the State Legislature allowed formulas to be put into place last year that escalated our property taxes to an ungodly level — so high, in fact, that they feared we might vote every one of them out of office if they persisted. Not a good move in an election year! So, they came up with a plan to reduce those property taxes long enough to get elected and then shuffled the revenues lost due to lower property taxes to a new system that would put the blame on local and county governments instead of the State. Slick, huh?
There are numerous Web sites on the internet that give great detail to what these “new” taxes are called and how they would be initiated and who would pay for them. You don’t have to read about EDIT, CAGET, COIT and LOIT for long before your eyes start to spin in their sockets. So, let’s see if we can make it simple for you. Every level of government needs revenue, paid by your taxes, to function. That includes our public schools. In Indiana, we have sales taxes (which are going up), property taxes (which will go down and then go back up) and income taxes (which we’re talking about doubling). Please, don’t make this too difficult. Last year we all paid 3.4 percent of our income in State taxes and 1.15 percent to Floyd County. If LOIT is passed, we will increase that 1.15 percent by another 1.25 percent to 2.4 percent. On anyone’s calculator, that is more than double the amount in taxes we will pay to the county. (I do not suspect that State income taxes will be going down either.)
Now, to be fair, you can’t lower one tax (property taxes) and keep the same services without raising another tax (here comes LOIT). You have to decide whether or not this “shift” from property taxes to income taxes seems fair to you. Then, you have to make some assumptions along the way. Like, did State government really need to raise my property taxes by 24 percent to pay for the level of government we needed? Plus, is giving back “some” of that 24 percent increase really going to be made up for by doubling my County Taxes? Or, might there actually be more increased revenue than needed for our elected officials to spend for services if LOIT passes and doubles our county taxes?
Here’s the real kicker. Of that 1.25 percent increase, 0.25 percent is allowed to go toward “public safety purposes,” like firefighters, police and emergency services. However, you only get the “safety” money if you take the added LOIT. That way we can all feel guilty at depriving our first providers if we don’t take the whole enchilada. Oh, and by the way, if I read this correctly, we don’t have to take the whole 1 percent to get the 0.25 percent. We can adopt LOIT at any rate between 0.05 percent and 1 percent, in 0.05 percent increments. Now, the Floyd County tax rate of 1.15 percent is low compared to many other counties. So, to be fair, we could increase our taxes slightly and still be close to most other counties. However, there are a lot of counties that have lower income taxes than Floyd County. Lake County had no local income tax at all as of 2008. How did they do that?
Oh, one other thing. Has anyone addressed the issue of wasteful spending in Floyd County? The answer is “no.” So, guys, God bless you! We appreciate the risk you take to keep us all safe and absolutely know you deserve more than you get. But to accuse those of us who are against a 1.25 percent tax increase because it means you would not get your portion of the 0.25 percent is, indeed, unfair. The answer is the same as it has always been. Responsible fiscal management of government at any level is expected and owed but seldom achieved. I balance my checkbook with what I earn. Government should do no less. Our citizens deserve that kind of government. Don’t pass LOIT until you can honestly tell us you have done your best to cut wasteful spending and absolutely must increase revenue for needed services and can describe exactly what it will go for. Is that asking so much?
Dave Matthews is the chairman of the Floyd County Republican Party.
Columns
MATTHEWS: County must address wasteful spending before considering LOIT
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