Letters to the Editor

State must fix its tax system

Kentucky ranks 46th in fiscal condition according to a just-released Mercatus Center study. Ranking worse than Kentucky are Illinois, New Jersey, Massachusetts, Connecticut and Puerto Rico. Here is what we have in common: massive debt obligations and unfunded liabilities (pensions and health care).

The surrounding states we compete with for employers and new investment are all ranked much higher: Tennessee is ninth, Ohio 11th, Indiana 17th.

In business, lean thinking has revolutionized many companies. The leading example of this is Toyota. We need Toyota’s analytical processes in Frankfort.

We are in a deep hole and unless our state government changes its focus radically to review every program, department and bureau and eliminate or re-engineer them, we will eventually follow Puerto Rico’s example. Our taxation system is archaic and should be replaced with a consumption-based tax, eliminating all loopholes and drastically reducing the cost of administering it. Our pension obligations must be addressed now. Waiting only makes the remedies more painful.

Ray Davis