A corporate tax cut could hit state, towns

President Bush's proposal to stimulate the economy by eliminating taxes on corporate dividends could end up costing state and local governments -- and ultimately taxpayers -- more money, some financial experts say.

Many investors rely on municipal bonds as a means of minimizing their tax bills because the income they generate is free from federal, and often, state taxes.

But new competition from another investment that provides tax-free income would probably mean that government entities would have to pay higher interest rates when they attempt to float bonds to finance capital improvement projects, some experts say....

--story in today's Newark Star-Ledger

Unintended consequences from the Bushies?

Or intended consequences?