The most common story to hear about states these days is how much fiscal trouble they are in, and how they need a federal bailout to close the holes in the budgets.


But in some states, there’s an entirely different conversation underway. In Arkansas, officials are discussing how best – and how quickly — to eliminate the personal income tax.

According to the Tax Foundation, Arkansas’ push is part of a broad effort to make the state more economically competitive:

Lt. Governor Griffin’s goal to eliminate the income tax is a commendable one that should be considered with cautious optimism, though with the understanding that even a well-designed process may end up putting more weight on an already uncompetitive sales tax. In the meantime, there is plenty of space for incremental improvements in Arkansas’s income tax that will make the state more competitive.

The Tax Foundation has also noted that Mississippi is on the path to eliminating both its personal and corporate income taxes.

Eliminating taxes is a fine idea – so long as they are not replaced with more cumbersome, complex, and regressive forms of taxation. And a healthy dose of fiscal restraint helps, too. Maybe this will be the feel-good fiscal story coming out of the states in 2021.

Image Credit: By Jericho [CC BY 3.0 (], via Wikimedia Commons