We know Proposition 208 will cost Arizona jobs. The question is simply how many.
A study by the Goldwater Institute says under the most conservative scenario job losses will reach a minimum of 124,000 over the course of a decade.
An analysis by national economists Steve Moore and Dr. Art Laffer is even more pessimistic,finding that an estimated 200,000 jobs would be eliminated over 10 years.
The dean of Arizona’s delegation of economic soothsayers, Elliott Pollack, says the “new tax rate would put the state at a significant competitive disadvantage.”
Even the left-of-center Grand Canyon Institute pegs the job losses at 10,000.
Left, right, or center, the consensus is that Proposition 208 will lose jobs.
It could be your job.
Proposition 208 raises the state’s top individual income tax rate by nearly double. It doesn’t touch the corporate tax rate.
It’s an important distinction. Small businesses pay their taxes on the individual portion of the tax code. Proposition 208 raises the top rate by 77.7%, which means small businesses will pay a top rate of 8%—much higher than the corporate rate of 4.9%.
That’s not fair, and it’s not smart.
Small businesses’ contribution to the Arizona economy is significant and it’s a sector that will be essential to the state’s post-pandemic economic recovery. Fifty-eight percent of Arizonans employed in the private sector work for an employer who pays their taxes via the individual income tax. They get absolutely walloped by Proposition 208. Their ability to keep and grow jobs is put in doubt. It could be your job that’s at risk.
We’re in the middle of a pandemic that has done tremendous damage to the Arizona and national economies. Arizona has clawed back a little more than half of the more than 290,000 jobs it’s lost during the pandemic, but we’re still down nearly 140,000 overall. Do we really want to risk even more damage to the economy? Proposition 208 makes the economic recovery more difficult.
Proposition 208 is not a mainstream proposal. It was not crafted as part of a dialogue between lawmakers, the education community, and job creators. Proposition 208 is extreme. Bernie Sanders has endorsed it. That’s an endorsement that speaks volumes. No one will mistake Bernie Sanders as an advocate for job creators and small businesses. He certainly doesn’t know Arizona.
In fact, nothing about this proposition is Arizona-grown. This is a science experiment gone bad cooked up by out-of-state activist groups.
The proponents’ coalition is paper thin. A handful of the usual suspects who never met a tax increase they didn’t like.
Meanwhile, the opposition to Proposition 208 is broad and deep. Every credible business group in the state, urban and rural, representing industries small and large, from real estate to agriculture to tourism and everything in between opposes Proposition 208. Small business, the sector of our economy targeted by the initiative, is solidly against the proposition’s passage. The Arizona Small Business Association, the National Federation of Independent Business, and local chambers of commerce across the state are some of the measure’s most vocal opponents. Even national powerhouse the U.S. Chamber of Commerce opposes Proposition 208.
Vote no on Proposition 208. Arizona can do better than to put its economy and thousands of jobs—maybe your job—at risk.
Glenn Hamer is president and CEO of the Arizona Chamber of Commerce and Industry.