November 15, 2016 | Montana Budget and Policy Center
The following is a statement from the Montana Budget and Policy Center in response to Governor Bullock’s proposed 2019 biennium budget, released today.
“Even with the difficult decisions ahead we are pleased that Governor Bullock’s proposed budget reflects the need to continue to invest in our communities. We cannot cut our way to prosperity. In order to grow our economy and help our state remain the place we all love, we must remain committed to funding the vital services we all depend on like schools, roads, water systems, and public safety.
“We applaud Governor Bullock’s commitment to working toward a tax system that is fair for all of us. For too long, our tax structure has disproportionately benefited the wealthiest, while leaving many of Montana’s working families struggling to make ends meet. This budget acknowledges that current revenue levels are inadequate, and we commend the Governor for calling on the legislature to eliminate special tax breaks that corporations and wealthy households have taken advantage of for years.
“As we move forward to the 2017 legislative session, we hope legislators across the state will follow the Governor’s lead in supporting budget decisions that provide opportunity to all Montana families, invest in our vital public systems, and put our state on the path to long-term prosperity.”
Earlier this year, MBPC released a report on the levels of lost revenue Montana has faced as a result of significant income tax cuts implemented in 2003 that disproportionately benefited the wealthy. In that report, MBPC called on the legislature to consider restoring a top tax bracket on high-income households and paring back the unfair tax advantage given to wealthy investors.
The Governor is proposing to help low- and moderate-income working families through the creation of a state earned income tax credit for working families. A state EITC could help nearly 80,000 Montana working families better make ends meet.
Under Montana’s current tax system, lower-wage workers pay a higher percentage of their income in state and local taxes, compared to wealthy households. When factoring in all state and local taxes, as well as tax advantages often tailored to wealthy, those earning less than $54,000 a year pay 6.1% - 6.4% of their income in taxes, compared to the top 1% (those earning more than $435,000) pay only 4.7% of their income in taxes. The Governor’s budget begins to right this wrong, by proposing a fairer tax system.
MBPC will release a more in depth analysis of the proposed budget in the coming days.
The Montana Budget and Policy Center (MBPC) is a nonprofit organization providing in-depth research and analysis on budget, tax, and economic issues. Our core focus is publishing credible, timely, and easy-to-understand reports on the fiscal policies that most impact low and moderate income Montanans. Our research and analysis then informs public policy, the media and the broader public.
MBPC is a nonprofit organization focused on providing credible and timely research and analysis on budget, tax, and economic issues that impact low- and moderate-income Montana families.