An Oxfam report released this week shows the richest 1% of individuals have gotten richer since the pandemic, capturing almost two-thirds of all new wealth.

The report calls for a 5% tax on the world's multimillionaires and billionaires. The finding comes as one state lawmaker pushes for reinstating the state's graduated income tax on Kentucky's highest earners.

Rep. Lisa Willner, D-Louisville, introduced legislation to restore a graduated income tax rate for those earning $100,000 or more annually, starting in 2024.

Willner explained 80% of workers in the Commonwealth would see no change under the proposal.

"The next 15% would get about a $42 a year increase in their taxes," Willner pointed out. "It would really be the top 5% who would be paying more into the system."

She added the state cannot function without sufficient revenue for schools, hospitals and public services. Republican lawmakers argued reducing, and even completely eliminating, income taxes puts more money back into the paychecks of working Kentuckians.

Willner countered retirees and others living on fixed incomes do not see any benefit from income tax reductions, but do pay a price when budgets for local infrastructure and health care are slashed.

"Because their earnings are low, they receive absolutely no benefit from the so-called tax cut on the income tax," Willner stressed. "But they're paying out of pocket could be on a daily basis from some of the new sales taxes that have been imposed."

Beginning this year, the state's income tax dropped from 5% to 4.5% under House Bill 8, and the rate will shrink by another half percent next year.

According to the Institute on Taxation and Economic Policy, the nation's lowest-income earners pay 50% higher local and state taxes than top earners nationwide.

The Iowa Legislature's powerful Ways and Means Committee has advanced a measure to eliminate the state income tax. The move is the latest in a series of votes to reduce taxes in Iowa.

Senate Study Bill 1126 would lower Iowa's income-tax rate to flat 2.5% in five years.

Then in 2030, the income tax would be eliminated completely. This comes just after Iowa passed a 3.9% flat tax last year.

Executive Director of nonprofit, nonpartisan Common Good Iowa Anne Discher said - given that the state income tax accounts for 50% of the Iowa's budget - eliminating it would decimate crucial public services.

"State aid to public schools is 43% of our state budget," said Discher. "We could entirely eliminate state aid for our entire public school system and it wouldn't be enough to cover the kind of income tax cuts that we're talking about. So, the kinds of service cuts really would be draconian."

Republicans have said this bill, and the flat tax signed into law last year, are designed to give Iowans broad tax relief and also make the state attractive to businesses that may be considering locating in Iowa.

Discher pointed out that Iowa is already facing a revenue shortfall due to last year's tax cut.

She added that eliminating the income tax revenue would affect mental health, safety and other social service programs in Iowa. But she warned that it could have other consequences, too.

"It is certainly a shot across the bow against racial equity, as well," said Discher. "We are further advantaging the wealthiest Iowans - further advantaging, as a group, white Iowans. Iowans of color are over-represented at the lower end of the income distribution, because of longstanding discrimination in housing, education and employment."

The bill moves next to the full Senate.

Critics of a proposed pay raise for state workers said it barely keeps up with inflation and is not enough to alleviate Kentucky's long-standing government workforce crisis.

House Bill 444 would use $89 million for a 6% raise, despite having $200 million already set aside.

Dustin Pugel, executive director of the Kentucky Center for Economic Policy, explained over the past two decades, the state's public workforce has shrunk, despite a growing population and increasing demand for public services.

"We've heard the last couple of sessions, horror stories really from people and child welfare and public defenders about how their caseloads have ballooned," Pugel reported. "That just creates a vicious cycle; when people are overworked and underpaid, they leave."

Last year the General Assembly passed an 8% across the board increase for state workers, and funneled extra cash to social workers, family support staff, public defenders, and the state police. Pugel pointed out while any raise is better than none, the legislation would still leave state workers making far less in inflation-adjusted dollars than they were in 2011.

Nationwide, pay increases for state and local government employees haven't kept pace with inflation or those of private workers, according to an analysis by the Pew Research Center.

Pugel noted a few years ago, when residents called local agencies for assistance with SNAP benefits, Medicaid, or unemployment insurance benefits, they spent hours waiting on the phone.

"Even now, when you call the department for community based services, you're likely to be on hold for 20, 30, 40 minutes before someone picks up the phone," Pugel observed. "About a third of folks who call in just end up hanging up before anyone helps them."

According to the Kentucky Center for Economic Policy, even with last year's raise, state government vacancies remain high.

Florida's legislative session - which begins Tuesday - has already made headlines as a conservative majority pitches bills to expand gun rights, ban diversity programs, make it easier to sue the news media, and further restrict abortions.

One coalition says this isn't what everyday Floridians are asking for.

Ruth Moreno, deputy director of the statewide group "Florida for All," said the average person is looking for the opposite of what's about to happen in Tallahassee.

Moreno said she also wants Gov. Ron DeSantis and legislative leaders to end what she sees as a corporate-driven agenda that benefits the wealthy.

"We cannot get away with not paying our taxes in Florida, yet corporations in the state of Florida do all the time, right?" said Moreno. "And they don't pay their dues. So, with the People's Budget, it's asking the question. It's offering a platform for everyday Floridians."

Lawmakers are preparing to advance bills that would require private companies to check their employees' immigration status, along with sweeping changes to limit lawsuits against businesses.

Moreno's group and others planned a virtual news conference today at 11 a.m. - to highlight their demands for "a government that works for the people."

The groups are calling for solutions to rising housing costs. And Moreno said they want to see an end to political interference in schools and universities, and criminal justice reform, to name a few priorities.

"The culture wars, the anti-protest bill" said Moreno, "these are things that are not real issues for people, right? The real issues that are impacting folks are, 'Is the school that my child's going to well-funded?'"

The prospect of lawmakers curtailing their current agenda is slim during the annual session, which runs for 60 days.

With a Republican supermajority, lawmakers have so far given every indication that they'll grant the governor's wishes, to give him a broader platform for his expected 2024 presidential campaign.




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