LITTLE ROCK — To claim that cutting the state income tax alone will make Arkansas more attractive to businesses is "at best shortsighted and fundamentally erroneous," Republican gubernatorial candidate Curtis Coleman said Thursday in a jab at GOP rival Asa Hutchinson.
Coleman spoke to the Political Animals Club in Little Rock about two weeks after Hutchinson spoke to the same group and said he favored cutting the state income tax gradually, as Democratic Gov. Mike Beebe has done with the state sales tax on groceries.
"If we pull one tax structure out of the cumulative tax structure, we’re going to create unintended consequences," Coleman said Thursday. "In fact I will tell you, I doubt that eliminating the state income tax in Arkansas will do much at all for making Arkansas more competitive for businesses.
"If you want to make Arkansas more competitive and attract more businesses to Arkansas, we’ve got to look at the corporate tax rate in Arkansas and reform the corporate tax code in Arkansas — one of the highest in the region. And we’ve got to eliminate the capital gains tax in Arkansas," he said.
Coleman, a Little Rock resident and the founder and CEO of Safe Foods Corp. in North Little Rock, told reporters after his speech that he has no specific plan for cutting taxes yet, but he said the plan would include cutting income and corporate taxes and eliminating the capital gains tax.
Coleman noted that Hutchinson, a former U.S. congressman and deputy secretary of the U.S. Department of Homeland Security, criticized Beebe’s plan to phase out the grocery tax when Beebe first proposed it during the 2006 governor’s race between Hutchinson and Beebe.
"(Hutchinson) has a curious record, based on the fact that he now is proposing gradually eliminating a tax in a process that he opposed in a previous race for governor," said Coleman, who ran unsuccessfully for the U.S. Senate in 2010.
Hutchinson responded in a prepared statement, "The big question is not any differences between the Republican candidates but rather what Mike Ross says about our high income tax rate. I am committed to lowering our state income tax."
Ross, a former congressman, is seeking the Democratic nomination for governor. Ross has said he favors a "smarter tax code" but has not yet provided details.
Also running for the Republican nomination is state Rep. Debra Hobbs, R-Rogers.
"All three GOP candidates agree on the need for a more competitive tax structure in Arkansas," Hutchinson said. "As I travel the state, one of the biggest issues I hear about from Arkansans is the high, burdensome state income tax. A lower state income tax would help create jobs, attract and retain business, and make Arkansas more competitive regionally and nationally."
Ross leads the pack in fundraising, having raised about $2 million for his campaign. Hutchinson reported last month that he had raised nearly $380,000, with Hobbs reporting about $155,000 and Coleman about $102,000.
In his speech Thursday, Coleman said he believes he can and will win, thanks in part to a statewide grassroots organization and his purchase of a data bank of voter information which he said his campaign is using to "micro-target" voters.
"We’re in the process now of identifying every registered Arkansas voter and rating their propensity to voting for Coleman for Arkansas, under the assumption and now political belief that data is as valuable as dollars. In fact, the last two presidential campaigns proved that data is the great equalizer," he said.
Coleman also said he supports vouchers to allow parents to use state money to send their children to private schools and favors easing regulations on businesses. He said that if he is elected he will appoint a panel of business people from across the state to review state laws and regulations and identify ones that are inhibiting growth of business.
The Political Animals Club is scheduled to host Ross on Aug. 16 and Hobbs on Aug. 20.