OPINION

Opinion GilbertSunNews.com | @GilbertSunNews /GilbertSunNews For more opinions visit gilbertsunnews.com

Corporate tax hike would undermine recovery

BY SCOTT SEPTEMBER

GSN Guest Writer

Now more than a year after the worst quarterly economic contraction on record, Arizona is leading the nation’s post-pandemic recovery. A report from the Arizona Commerce Authority last month finds 87 percent of our state’s jobs have been restored, the third best in the nation.

QuickBooks’ Small Business Recovery Report in May identified Gilbert and Mesa as top five cities for small business recovery.

These achievements owe largely to smart, pro-growth policies that predated the pandemic and helped mitigate the downturn and accelerate a rebound. In Gilbert, for example, the Town Council was actively working to build up our small business community long before the COVID-19 outbreak. We immediately focused on providing support where it was needed most from the earliest days of the pandemic including a three-phase program focusing on relief, recovery and resiliency. All eyes should be on Washington to see if lawmakers will support these efforts to rebuild our economy, or if they will put party-line philosophy first.

This spring the White House proposed raising the U.S. corporate tax rate, a position that has since been adopted by some lawmakers on Capitol Hill. While the proposal may be well intentioned, it could upend the burgeoning economic and job recovery finally starting to take root across the country. While Arizona’s recovery may be among the best in the nation on paper, if you talk to business owners and workers, they paint a different story. More than 33,000 jobs in the leisure and hospitality industry have yet to return. Employment in the construction and manufacturing sectors is down another 3,000 jobs from before the pandemic. Small business revenue is more than 40 percent below January 2020 levels. Arizona may be ahead of the curve, but the reality is the curve isn’t great. Across the country, even here in Arizona, many families and businesses are struggling.

Like the pandemic itself, our economic recovery has not been equitable. Low-income earners and minorities, who were more likely to experience wage and job losses during the pandemic, are more likely now to still be out of work or to have dropped out of the labor force entirely. Policymakers ought to be removing the barriers that are holding back job creation and exacerbating the wealth divide, not adding to it. Raising the federal corporate tax rate could do the opposite, even as the President has pledged to build up our middle class. While it may be tempting to raise taxes on “faceless” corporations, workers ultimately bear the burden. Research shows between 70 and 100 percent of corporate taxes are passed onto workers over the long run. This occurs through reduced wages, fewer jobs and less capital investment in productivity. When a company has to pay more in taxes, it has less to put into paychecks.

The White House has said that a corporate tax increase would not affect businesses or individuals who earn less than $400,000 per year. However, a study by the Congressional Joint Committee on Taxation concludes a full 98 percent of people who earn less than $500,000 annually would be impacted. It notes that workers, retirees and small businesses would be disproportionately harmed. President Biden promised to rebuild America’s (and Arizona’s) middle class. He and his fellow Democrats in Washington should not let political ideology undermine that goal. Keeping our corporate tax rate competitive will continue to unlock growth and reinforce local efforts that are building back stronger.

College hunger is a real issue in the East Valley

BY DAVE RICHINS GSN Guest Writer

Area college and university campuses look to be back in force this fall, with tens of thousands of students potentially returning for in-person classroom learning. It would be easy to assume that these students are all filling up their plates at campus dining halls as part of their meal plans. You might be surprised, then, to learn about the many food assistance partners United Food Bank supports on campuses such as Mesa Community College, Chandler-Gilbert Community College and Arizona State University. In fact, our food bank provides meals to about 25,000 higher-education students each school year.

According to Feeding America, the demographics of today’s college student populations are significantly different than they were in previous decades. For example, a whopping 71 percent of today’s college students are non-traditional. That means they have one or more of the following characteristics: experience in financial independence (their bills aren’t being footed by parents), are enrolled in school part-time but work full-time, are caretakers for dependents and/or did not receive a traditional high school diploma.

The average age of students starting college is now 21 years, with the average age of all students at 26. The result is that more of today’s students are balancing schoolwork with parenting. In fact, 22 percent of students care for child dependents; 14 percent of them as single parents. All these changing statistics have led to an increased share of college students who have low household incomes.

United Food Bank partners with organizations on campuses throughout our region to fill this growing need for food assistance. For example, last school year Mesa Community College hosted a monthly food distribution called We Care Wednesday at both of their campuses. At Chandler-Gilbert Community College, monthly fresh produce distributions have helped students focus on learning rather than food and basic needs.

The Emergency Coronavirus Relief Act passed last December allows approximately 6 million more college students to be eligible for SNAP (Supplemental Nutrition Assistance Program) benefit, which can be used to purchase groceries.

These are all steps in the right direction to address a population in need of food assistance that has been previously overlooked.

We’re committed to continuing to provide nutritious foods for on-campus distributions as we strive to bring food assistance to the people who need it where they need it. You can help support these efforts by donating at unitedfoodbank.org/donate.

Every dollar you donate translates into five student-supportive meals.

Dave Richins is CEO of United Food Bank.