By Wall Street Journal Editorial Board
Arizona has long been a refuge for Americans seeking relief from high-tax California and states in the Northeast. But a tax referendum on the ballot Nov. 3 would whack job creators and make people rethink retirement in Scottsdale or a business move to Tucson.
Proposition 208, or the Invest in Education Act, would impose a 3.5% surtax on incomes above $250,000, or $500,000 for joint filers. The current top rate of 4.5% would rise to 8%, which would move the state to the 10th highest income-tax rate in the country, from 11th lowest today, according to the Tax Foundation. Arizona would move closer to California (13.3% top rate) than Nevada (no income tax).
As ever, this is being pitched as soaking the rich, but about half of the targets would be small businesses that pay taxes at the individual rate, according to the Grand Canyon Institute. They employ a huge chunk of Arizona workers, and the added tax costs would trickle down in lower pay and fewer jobs.
