LC 3.1 Resolution to Establish the Budget of the Lincoln Government (Passed)

[Pyro]

IN THE LINCOLN COUNCIL

A RESOLUTION

Establishing the budget for the Lincoln Government lasting from September 2019 until August 2020

Resolved by the Lincoln Council convened,

Expenditures

Health - $269.89bn + $1.49bn (L603) = $269.89bn

Pensions - $104.40bn + $0bn (LC 11.11) = $104.40bn

Education - $105.19bn + $ 35.63bn (L505, L601, L 12.9, L 13.06) = $140.82bn

Defence - $0.10bn + $0.03bn (L 11.22) = $0.13bn

Transport - $54.18bn + $0.48bn (L 15.6) =$54.66bn

Welfare - $40.93bn + $0.22bn (L 11.4.2, L 14.9) = $41.15bn

General Govt - $20.27bn + -$0.11bn (L513, L 15.9) = $20.16bn

Debt Interest - $23.30bn

Protection - $23.83bn + $4.86bn (L 6.4.3, L 7.3.1, L 10.16.5) = $28.69bn

Other - $31.44bn + $0.98bn (LC 1.13) = $32.42bn

One time additional spending - $39.54bn (L 6.5.1, L 7.1.1, L 7.4.2, L 7.5.1, L 9.10.5, L 10.16.5, L 10.26.5, L 11.17, L 15.3)

===============================

TOTAL EXPENDITURES - $ 755.80 billion

===============================

PROPOSED TAXES

Income tax
0.0%    $0 - $24,999 ($0 B)
10%    $25,000 - $49,9999 ($13.19 B)
16%    $50,000 - $99,999 ($58.66 B)
23%   $100,000 - $249,999 ($131.46 B)
28%   $250,000 - $999,999 ($80.20 B)
33%   $1,000,000 + ($46.28 B)

Rates remain the same for married couples filing jointly, but brackets are doubled.

Alcohol Tax
10% ($5.82 B)

Tobacco Tax
10% ($2.87 B)

Cannabis Tax
10% ($2.09 B) + $1.25bn (L10.25.4) = $3.34bn

Other drugs tax (L10.25.4) = $0.58bn

Excise Taxes
Gas: $0.50 per gallon ($22.24 B)
Diesel: $0.70 per gallon ($10.37 B)
New automobile purchase tax (by curb weight): $120 per thousand kilograms ($1.02 B)

Luxury Tax
30% ($6.48 B)

Wealth Tax
1% ($49.50 B)
Total Wealth Tax with Lincoln Population Multiplier = ($15.42 B)

Property tax
0.0%    $0 - $24,999 ($0 B)
1%   $25,000 - $49,9999 ($15.53 B)
2%    $50,000 - $99,999 ($54.57 B)
3%   $100,000 - $249,999 ($78.63 B)
4%   $250,000 - $999,999 ($24.21 B)
5%   $1,000,000 + ($7.60 B)

Estate Tax
15%  $10,000,000 - $19,999,999 ($0.61 B)
15%  $20,000,000 - $49,999,999 ($1.66 B)
20%  $50,000,000 + ($6.79 B)
Total Estate Tax with Lincoln Population Multiplier = ($2.82 B)

Corporate Tax
0.0%  $0 - $99,999 ($0 B)
5%   $100,000 - $499,999 ($0.27 B)
5%   $500,000 - $999,999 ($0.16 B)
10%  $1,000,000 - $4,999,999 ($1.00 B)
10%  $5,000,000 - $9,999,999 ($0.68 B)
15%  $10,000,000 - $24,999,999 ($1.94 B)
15%  $25,000,000 - $49,999,999 ($1.82 B)
15%  $50,000,000 - $99,999,999 ($2.22 B)
15%  $100,000,000 - $249,999,999 ($3.83 B)
15%  $250,000,000 - $499,999,999 ($4.45 B)
15%  $500,000,000 - $2,499,999,999 ($21.09 B)
15%  $2,500,000,000 + ($141.91 B)
Total Corporate Tax with Lincoln Population Multiplier = ($55.86 B)

Carbon Tax (LC 2.20)
20$ per metric ton of CO₂: $35.03 B

===============================

TOTAL REVENUES - $672.18 B
===============================

PROJECTED DEFICIT - - $ 83.62 B

Sponsor: Pyro

The Debating Period has commenced. It shall last no less than 72 hours.

[Pyro]

With this session we shall resume debate regarding the matter of settling the regional budget. The above text is the latest resolution, keeping intact all approved amendments from LC 2.28.

I would encourage all new and returning Councilors to provide your thoughts as we enter debate. There is much to discuss, and although we have dramatically refined the bill from its original state, we can still improve further.

As far as my own opinion is concerned, please see my below comments from the original debate.

Mr. Speaker and Fellow Councilors,

We have before us the task to formally establish the budget of our region. In the estimated figured as noted above, our expenditures outweigh our revenue by an intimidating margin, meaning we must, by law, find and codify additional sources of revenue to offset the costs in our baseline expenditures or reduce spending to match the revenue supply.

I may represent the Government and that of the Left in these budget discussions but I am not deaf to the concerns of each side. We will need to make some tough decisions in order to reach a balanced budget, and it is my expectation that we hear everyone out and, ideally, come a consensus on how to proceed.

It would be my position that we avoid cutting spending in any of our crucial social and economic welfare programs, including healthcare and education, in order to achieve this task. The working people of Lincoln depend on these services and it would do them a great disservice to cut such programs unless all other possible options have been exhausted.

We have several avenues for growing our revenue. These shall be debated, presumably at length, in this session of Council. For instance, Lincoln presently does not levy a tax on corporations, nor on financial transactions. I would personally oppose it at the present time, but Lincoln also does not levy a sales tax.

I look forward to these discussions as we accomplish what prior sessions of Council and Assembly have failed to do and prepare a budget outlining the finances of our region. Thank you.

[DKrol]

Mr. Speaker,

I propose the following amendments. I ask that each be treated as a separate amendment.

Cannabis Tax
1020% ($2.09 B) + $1.25bn (L10.25.4) = $3.34bn

Wealth Tax
13% ($49.50 B)

Corporate Tax
0.0%  $0 - $54,99999,999 ($0 B)
2% $55,000 - $99,0000
5%   $100,000 - $499,999 ($0.27 B)
5%   $500,000 - $999,999 ($0.16 B)
10%  $1,000,000 - $4,999,999 ($1.00 B)
10%  $5,000,000 - $9,999,999 ($0.68 B)
15%  $10,000,000 - $24,999,999 ($1.94 B)
15%  $25,000,000 - $49,999,999 ($1.82 B)
15%  $50,000,000 - $99,999,999 ($2.22 B)
1520%  $100,000,000 - $249,999,999 ($3.83 B)
1520%  $250,000,000 - $499,999,999 ($4.45 B)
1525%  $500,000,000 - $2,499,999,999 ($21.09 B)
1550%  $2,500,000,000 + ($141.91 B)
Total Corporate Tax with Lincoln Population Multiplier = ($55.86 B)

These amendments increase sources to revenue without, I feel, unfairly impacting the average taxpayer in Lincoln. They will help eat away at the projected deficit while ensuring that those who are more fortunate and better off are paying their fair share in our society.

Thank you, Mr. Speaker.

[lfromnj]

Mr. Speaker,

I propose the following amendments. I ask that each be treated as a separate amendment.

Cannabis Tax
1020% ($2.09 B) + $1.25bn (L10.25.4) = $3.34bn

Wealth Tax
13% ($49.50 B)

Corporate Tax
0.0%  $0 - $54,99999,999 ($0 B)
2% $55,000 - $99,0000
5%   $100,000 - $499,999 ($0.27 B)
5%   $500,000 - $999,999 ($0.16 B)
10%  $1,000,000 - $4,999,999 ($1.00 B)
10%  $5,000,000 - $9,999,999 ($0.68 B)
15%  $10,000,000 - $24,999,999 ($1.94 B)
15%  $25,000,000 - $49,999,999 ($1.82 B)
15%  $50,000,000 - $99,999,999 ($2.22 B)
1520%  $100,000,000 - $249,999,999 ($3.83 B)
1520%  $250,000,000 - $499,999,999 ($4.45 B)
1525%  $500,000,000 - $2,499,999,999 ($21.09 B)
1550%  $2,500,000,000 + ($141.91 B)
Total Corporate Tax with Lincoln Population Multiplier = ($55.86 B)

These amendments increase sources to revenue without, I feel, unfairly impacting the average taxpayer in Lincoln. They will help eat away at the projected deficit while ensuring that those who are more fortunate and better off are paying their fair share in our society.

Thank you, Mr. Speaker.

Hey guys remember that Southern bill that gave a bunch of tax cuts for leaving Lincoln. Great news with the passage of this corporate tax they wouldn't even need it because you would get the same net benefit from leaving Lincoln.A 50% corporate tax on top of the federal 35% for around a top marginal rate of 67% federal tax either A, just encourages regular Hollywood accounting or B, actually encourages companies to just flat out leave Lincoln.

And the Wealth tax is frankly just insane. Its not a one time wealth tax. Its a repeated tax. There is literally no reason for anyone who thinks ahead to stay in Lincoln when they effectively have half the marginal gain return per year compared to an area like the South.(assuming 9% average growth in a market and 3% inflation) This either means a hiding of assets not giving us as money as expected or people just moving out.

[DKrol]

If a corporation is making $2.5 million or more each year, they can afford to give 50% back to the community and still have a comfortable operating budget. I have no sypmathies for massive corporations.

As to the wealth tax rate, I'm open to discussions or suggestions of what rate to set it at. Maybe 3% is too high. I think 1% is too low. Would 2% work? 2.5%?

[lfromnj]

If a corporation is making $2.5 million or more each year, they can afford to give 50% back to the community and still have a comfortable operating budget. I have no sypmathies for massive corporations.

As to the wealth tax rate, I'm open to discussions or suggestions of what rate to set it at. Maybe 3% is too high. I think 1% is too low. Would 2% work? 2.5%?

Explain why as a massive corporation you would focus on Lincoln when you could literally get next to double the profits in the South for doing almost nothing besides moving there?

[DKrol]

If a corporation is making $2.5 million or more each year, they can afford to give 50% back to the community and still have a comfortable operating budget. I have no sypmathies for massive corporations.

As to the wealth tax rate, I'm open to discussions or suggestions of what rate to set it at. Maybe 3% is too high. I think 1% is too low. Would 2% work? 2.5%?

Explain why as a massive corporation you would focus on Lincoln when you could literally get next to double the profits in the South for doing almost nothing besides moving there?

The people of Lincoln are the hardest working people in the nation, producing a dedicated workforce. Lincoln is home to finest colleges and univeristies of the nation, producting an educated workforce. Lincoln is the center of the financial industry in the nation, producing easy access to capital and future investments. There are many reasons to call Lincoln home for a corporation or business of any size, especially because there are some businesses who recongize they owe it to the community to pay back their fair share. I imagine there will be some corporations that move back to Lincoln if this amendment is passed, because they want to play their part in our society.

[NyIndy]

I believe the 2% wealth tax is a fair compromise.

[lfromnj]

Also to note the combination of a luxury tax with a wealth tax doesn't work very well. It both punishes "hoarding" money and spending that very same money. A wealth tax may make economic sense where one wishes to encourage spending to stimulate an economy. But to then immediately punish that spending makes no sense. Why can't Lincoln agree that everyone should share the tax burden?

[lfromnj]

The wealth tax also needs to be fixed. it says its only applied to the top 0.1%. That is a major problem and another tax cliff. It should rather be all wealth above 10,000,000 or another number that you guys find acceptable.

[lfromnj]

Also to put into statement how insane the corporate tax rate is. The average OECD corporate tax ranges in the mid 20s. The old US was the highest in the OECD at around 35%. This puts an effective rate of 67%

[Pyro]

I recognize the amendments provided by Councilor DKrol.
I will introduce them one at a time per request.

Regarding this initial one, I do not consider raising the Cannabis Tax necessary. 10% is a rather high figure as it is, and it presently matches the 10% Alcohol and Tobacco taxes which I would consider a fair arrangement.


Amendment L 3:03 by DKrol to LC 3.1 Resolution to Establish the Budget of the Lincoln Government

Cannabis Tax
1020% ($2.09 B) + $1.25bn (L10.25.4) = $3.34bn

Sponsor: Unfriendly
Status: 24 Hours for Debate, Followed by a Vote

[Pyro]

A couple of questions:

(1) What is the minimum threshold before the wealth tax kicks in, if any?

This is Encke's figure on the Wealth Tax:

(2) I have as much of an issue with generational wealth as anybody, but is the 3% figure at a point where it would cause wealth flight? Surely there's a sweet spot that does exist that maximizes tax revenue and growth, but is this figure too high?

I set the figure at 1% as this is a new and experimental tax for the region. We are also introducing several other similar programs like this tax that basically impacts the same demographic.

[Pyro]

If a corporation is making $2.5 million or more each year, they can afford to give 50% back to the community and still have a comfortable operating budget. I have no sypmathies for massive corporations.

As to the wealth tax rate, I'm open to discussions or suggestions of what rate to set it at. Maybe 3% is too high. I think 1% is too low. Would 2% work? 2.5%?

That will essentially be up for debate with your third amendment, Councilor.
We can certainly adjust the figure itself.

[Pyro]

Councilors, A Vote is Now OPEN on the Following Amendment:

Amendment L 3:03 by DKrol

Cannabis Tax
1020% ($2.09 B) + $1.25bn (L10.25.4) = $3.34bn

Please vote AYE, NAY or Abstain
This vote shall last for 48 hours or until all Councillors have voted

[PSOL]

AYE

[Pyro]

NAY

[DKrol]

Aye

[NyIndy]

Aye

[Pyro]

The Voting Period for Amendment L 3:03 has closed.

Aye: 4 (PSOL, DKrol, Thr33, NyIndy)
Nay: 1 (Pyro)
Abstain: 0
Not Voting: 2 (Wazza, Ishan)

The AYEs have it. L 3:03 is added to the bill.
We will need to acquire a revenue estimate to the increase.

[Pyro]

Amendment L 3:10 by DKrol to LC 3.1 Resolution to Establish the Budget of the Lincoln Government

Wealth Tax
13% ($49.50 B)

Sponsor: Unfriendly
Status: 24 Hours for Debate, Followed by a Vote

[DKrol]

To be clear about this wealth tax, from what I can ascertain, it's similar to the one Warren is proposing? So it only impacts those with $50M+ in wealth?

That is my understanding.

[Pyro]

In response to Amendment L 3:03, I propose the following amendment.

Alcohol Tax
12% ($ TBD) 10% ($5.82 B)

Tobacco Tax
12% ($ TBD) 10% ($2.87 B)

Cannabis Tax
12% ($ TBD) 20% ($TBD) + $1.25bn (L10.25.4) = $3.34bn

I generally remain opposed to the levying of "sin taxes", but considering the reality that this Council has increased the tax on cannabis products, I believe it is only fair to do the same for alcohol and tobacco products.

[Pyro]

Councilors, A Vote is Now OPEN on the Following Amendment:

Amendment L 3:10 by DKrol to LC 3.1 Resolution to Establish the Budget of the Lincoln Government

Wealth Tax
13% ($49.50 B)

Please vote AYE, NAY or Abstain
This vote shall last for 48 hours or until all Councillors have voted

[PSOL]

AYE