A man’s home is his castle. GOV. BROWNBACK’S plan is to eventually scale down the personal income tax rate to zero, thereby removing one of the three traditional legs of state funding — personal, property and sales taxes.
Well, less and less so in Kansas. Here, it may be more of an albatross.
For the average American, his home is his biggest asset. We plow our earnings and savings into buying a home. Much of each paycheck goes toward its mortgage. Right or wrong, home ownership is the American dream.
Kansas homeowners still paying down their mortgages currently enjoy a tax deduction of an average $389 on their state income taxes. The bigger the mortgage, the bigger the deduction.
Gov. Brownback wants to eliminate the tax break.
And while that may seem to be a progressive move, meaning it hits the wealthiest the hardest, also caught in its wake are young families and the elderly who are struggling to hang on to the idea of home ownership and appreciate any tax break they can get.
Home ownership also means a big investment in a community, especially such as Iola where rental alternatives are slim to none.
For young families home ownership means buying into a community and setting down roots. Close on the heels comes enrolling children in schools, choosing a church, participating in civic activities, and eventually taking on leadership roles in what has become a hometown.
These are all activities we as a state need to encourage.
That would be fine, if all things were equal. If we all had similar-sized incomes and lived in similar-sized cities, then our expenses and holdings could be expected to be in the same neighborhood.
Trouble is, Kansas is a very disparate region. Kansas City, Lawrence and Wichita are flush with industries, retail stores and restaurants, convention centers, and high-priced real estate. Much of the rest of the state, however, is population- and resource-poor.
In areas such as Allen County, fewer people have to pay more in property and sales taxes to provide adequate services.
When the income tax is eliminated on say Charles Koch of Wichita’s Koch Industries, whose net worth is $25 billion, you’ve kissed goodbye a tidy sum, even at the lower 4.9 percent rate — all in favor of raising other taxes on the majority of Kansans.
Brownback’s theory is Mr. Koch will take that realized savings and plow it into a business venture.
Not to be unkind, but the wealthy won’t direct said bonus to a specific endeavor. It’s just more to the pot.
But young families in the early stages of buying a home when the mortgage rate deduction is most generous, will certainly feel its loss most acutely.
Buying a home has trade-offs. Kansas legislators will be putting a mark in the “no” column by eliminating the mortgage interest tax break.
— Susan Lynn
