As mentioned, you cut out corporate taxes and the money is still there in the economy (without having the multi-billion dollar expense of collecting it and then giving back as a stimulus package). Each time it changes hands more taxes get collected from it – but more jobs are earned, more products sold, more companies able to stay alive. Roger is absolutely right in that the immediate cuts would only be to the state general fund and budgets of agencies. If only every tax payer could see the things some of us have seen that get millions of dollars thrown at them, they would be sick. Trust me, government could easily lose another 15 maybe even 20% without threatening to directly impact the services they are supposed to be providing to the public.

Now…the extremely obvious point here is that many, many companies looking for a place to build that shiney new factory are going to consider a state that does not have corporate income tax. Don’t believe me? Ask BMW – who selected Greer only after getting huge tax breaks – enough to cause a class action lawsuit from those that still had to pay taxes.

One impact, learned from BMW though, is the impact on education. Spartanburg School District 5 would have directly benefited from BMW taxes – but instead are not bringing in what they thought. Granted, they are not hurting in comparison to many of the other 80+ districts in the state, but it highlights a point. Education is the key to our future – any new companies attracted to SC will need a decent work pool. We would need to adjust revenue – probably from a +$0.01 income tax, for education. Florida has a sales tax of $0.08 in most areas.

Bottom line – increasing taxes has NEVER been the right answer to stimulate any economy. Even the Liberals are realizing that now – look at the Obama plan – biggest tax stimulus package in the history of mankind…I seriously pity a couple generations from now that are cleaning the houses of Chinese citizens to pay back that debt.