JRLC Budget and Taxes Letter

The following is the text of a letter sent to all Legislators:

April 21, 2009

AN OPEN LETTER TO MEMBERS OF THE MINNESOTA LEGISLATURE

Dear Members,

We write to let you know of our support for raising taxes as part of this year’s solution to the budget crisis. We know raising taxes is a difficult choice and we pray that all of us find courage and insight in the days ahead.

First, we believe the state’s overall budget crisis cannot be resolved in a humane and fiscally healthy manner without raising revenues. New revenues are key in order for us to maintain our quality of life, the quality of our workforce, and our economic vitality in the future. One clear indicator that revenues are needed are the proposed cuts to health care services needed by those least able to pay for medical bills or health insurance.

Second, our revenue system is unfair. We need to rely more on the income tax, which is the only progressive tax source able to counter to regressivity of sales and property taxes. Currently, the incidence of all taxes falls too heavily on households with the least resources while the wealthiest households do not even pay the same rates shouldered by the middle class. We believe our overall system should respect ability-to-pay and therefore should be marked by mild progressivity over the whole range of incomes.

We are not naïve about the effect of taxation on the business climate. We have carefully researched the relationship of public outlays and per capita income amongst the states and we have looked at the numerous studies done on taxes and business location decisions. We are convinced that the best thing we can do is to increase the investments in our people and ensure that Minnesota is better poised than our neighbors to “take-off” when the recovery begins.

This is a matter of social justice. Minnesota has done well by investing in public services and in our people; this is a tradition and a winning formula we dare not abandon. Rising poverty, unemployment, income inequality, and sluggish job growth are the effects of recent public retrenchment. We are on better footing when we have a vital public sector, investing in our people, and the basis for revenue collections is one’s ability to pay. In our view the people of Minnesota are willing to do more, but what we ask of people must be fair.

Sincerely,
JOINT RELIGIOUS LEGISLATIVE COALITION
Brian A. Rusche
Executive Director