As Alabama’s economy continues to defy a downturn trend some states around the country have to grapple with, the amount of revenue filling state government coffers continues to exceed expectations.
That is a trend that is true for Alabama’s education trust fund budget, which is reportedly experiencing double-digit growth.
During an interview with Mobile radio FM Talk 106.5’s “The Jeff Poor Show,” State Sen. Arthur Orr (R-Decatur), the Senate education budget chairman, argued it was time to consider lessening the tax burden for certain individuals.
“It is something, Jeff, that as conservatives I think we do need to talk about,” Orr said. “And I can see, being the budget chair, a scenario where tax cuts should very well be on the table. And by that, I mean we’ve got some responsibilities as far as our obligations and funding. We’ve got some federal money coming in that we need to take into account. When that goes away, we’ve got pay raises and other things. I’m a firm believer — you get what you pay for. And we need to take care of those in the education system in state government. And then, we’ve got COVID still lurking around our state, and what is that going to do to our revenue? So, you’ve got a lot of variables out there. But assuming those variables kind of cut in our favor, then I think it is time, Jeff, that we as legislators really get our pencils out and look at what can we send to the people of Alabama, and to whom do we send the funds back to that are paying them today.”
The Morgan County Republican explained how increasing the standard deduction would allow for his proposed cuts to be targeted for low-income families and retirees, which could offset an inflationary economy’s tax and financial burdens.
“We’ll look at raising the standard deduction for those that take the standard deduction,” he explained. “Now, a lot of people after $50,000 — they itemize their taxes. So, it’s not worth it to them to take the standard deduction. But for those, and again, the breakpoint is around $50,000 in household income — they are the ones that use that standard deduction. We would raise that, thereby giving — I’m going to call them lower middle-class, working poor-type workers get a tax cut, as well as retirees who are on fixed income. And the reason for this, Jeff, and I don’t think I’m smarter than the next guy, but I think we’re looking at an inflationary environment around the bend. I believe it is already here. But I think it is only going to get more pronounced in the months ahead.”
“[I]n an inflationary environment, the government gets more,” Orr added. “It is something I think we need to vet and to discuss, I believe, in the upcoming session, as long as the revenues and the commitments that we make break in our favor.”
@Jeff_Poor is a graduate of Auburn University and the University of South Alabama, the editor of Breitbart TV, a columnist for Mobile’s Lagniappe Weekly, and host of Mobile’s “The Jeff Poor Show” from 9 a.m.-12 p.m. on FM Talk 106.5.