EDITORIAL: State should adopt truly progressive taxing system based on ability to pay

Vincennes Sun-Commercial

The governor this week announced his plan to provide property-tax "reform," an issue many observers say he has come to recognize as serious only recently - and with his re-election in doubt.

Had reassessment in Marion County not proved such a disaster, quite likely property-tax reform wouldn't be getting the attention from Mr. Daniels that it's now getting.

His plan covers a lot of ground, proposing caps on how much homeowners would have to pay in property taxes while seeking to, again, increase the state sales-tax rate, this time by almost 17 percent, further harming those who in all likelihood will never be able to afford a home of their own.

The governor can argue all he wants that paying a sales tax is "voluntary," but that's a rich man's argument against raising the income-tax rate, and perhaps reveals a discernible lack of understanding of how hard it is for many of his fellow residents to make ends meet.

Indiana's odd tax system, one which effectively taxes most those residents who are the least able to pay, does need changing. It's a bad system which, over the years, has left our state's public infrastructure - roads, bridges and buildings as well as educational, health and welfare services - to be pitied rather than admired.

Under the governor's plan the owner of a house with a market value of $10 million would pay taxes at the same rate as the owner of a house valued at $50,000.

That's just wrong, just as it is for those earning $10 million a year to pay income taxes at the same rate as someone making $50,000.

There is an opportunity in the upcoming session of the legislature to adopt meaningful tax reform, and not this hodgepodge of so-called reform being offered by the governor.

It would be far better for our state to adopt a truly progressive taxing system, one based on an ability to pay, whether that ability be defined by income or property, while reducing the regressive, unfair sales tax.

We need additional resources to invest in our public infrastructure, resources which must be collected in the most-equitable manner possible.