Posted on 03/20/2002 4:52:36 AM PST by GailA
Edited on 05/07/2004 9:19:58 PM PDT by Jim Robinson. [history]
With lawmakers still in a stalemate, a Republican senator has proposed having voters choose in November to approve a constitutional convention adopting a revised sales tax rate, or against a convention, resulting in an income tax.
Under the plan submitted to the Senate Finance Committee yesterday by David Fowler, R-Signal Mountain, voters would voice a tax preference by voting for or against a referendum calling for a constitutional convention.
(Excerpt) Read more at tennessean.com ...
If you don't like taxes, Mr. Fowler, then explain why you keep trying to ram them down our throat. I have a suggestion for you to end the "3-year old logjam over taxes" you and your cronies have created: CUT SPENDING
Get it?
Now they want to LEVY MORE TAXES on the TAX SERFS to bail themselves out of this recession and 12% spending increase. The suggestions below are JUST THE TIP OF THE ICEBERG!
'Rep David Davis, with the agreement of Crowe and Patton, said a shortfall in the current budget of upwards of $350 million is a "real deficit,'' while past budgets "artificially" inflated expenditures to produce a deficit. '
They keep saying we need MORE revenue, that we need MORE taxes up there in the General Assembly.
Well I go and read their budgets THEY DON'T NEED MORE TAXES!
IT'S THE SPENDING STUPID!
There were lots of items that could be cut instead of education or tenncare. Tenncare is the BIGGEST State boondoggle in history. Can't even get the DEAD people off it, much less the ineligibles. At inception in 1994 the program cost $2.73B, for fiscal 2001-2002 $5.8B more than double. At least 20% are ineligible. Taxquist has $10M more slated for open enrollment.
YOU HAVE NOT CANCELED OR CUT The $15M performing arts center, the $1.5M for wild flowers in the medians to honor veterans (BETTER TO SPEND THAT MONEY ON THE VETERANS SERVICES instead of a stinking flower that blooms for two weeks a year), the $400,000 black enterprise conference, the $4.3M TN arts commission, the holocaust commission, the civil rights commission, the human rights commission $1,180,800, the indian commission, the historic commission there are dozens of commissions each one consuming at the very least $1M+ yearly, that could be cut or trimmed heavily as they serve NO real useful function except as high paid jobs for legislators wives/husbands family members or friends.
The 2.5, 3.5 and 5% pay raises, which total OVER $130M (private enterprises ARE NOT giving these kinds of raises). The $20M in compensation for certain State workers (to compete with private enterprise). Public TV gets $3,223,600 yearly and they want another $6M to go ditital (which it would need for WKNO in Memphis alone).
Coming out of Transportation budget $25M for the PARKING GARAGE for the grizzlies arena.
It is totally assinine to fund a stupid parking garage when you plan to CUT K-12 by $400M!
Have you canceled all those 20 or more "in honor of road signs", those signs cost $500 for the pair. Or those speciality license plates that take the State TWO years to realize a profit from?
$10M reading coaches (NEW PROGRAM), $11.1M Catch up program for 7th & 8th graders taking the new Gateway test (NEW PROGRAM), Early Childhood Education $40.3M (will become mandatory school for 4 year olds) (NEW PROGRAM). State Musuem $2,401,900, Boll Weevil eradication (gotta get rid of the Lt. Gov boll weevils) $2.5M, yearly for the Geographic Information System (fancy digital mapping of the State), $10M for land purchase for the Elk and Warbler.
SEE I FOUND LOTS TO CUT WITHOUT TOUCHING K-12.
Mayor Ashe noted that a 1-cent increase in the state gasoline tax would produce $29 million a year.
He said $3 million could be used to open closed state parks and the remaining $26 million could go for education.
INSTEAD OF RAISING THE GAS TAX SHIFT 5 cents over to education and parks to solve this "supposed" funding problem..but no gutless wonders in Nashville don't have the cahones to touch this sacred cow.
"We must not let our rulers load us with perpetual debt. We must make our selection between economy and liberty or profusion and servitude. If we run into such debts as that we must be taxed in our meat in our drink, in our necessities and comforts, in our labors and in our amusements, for our callings and our creeds...our people.. must come to labor sixteen hours in the twenty-four, give earnings of fifteen of these to the government for their debts and daily expenses; and the sixteenth being insufficient to afford us bread, we must live.. We have not time to think, no means of calling the mis-managers to account, but be glad to obtain subsistence by hiring ourselves to rivet their chains on the necks of our fellow suffers. Our landholders, too...retaining indeed the title and stewardship of estates called theirs, but held really in trust for the treasury, must...be contented with penury, obscurity and exile.. private fortunes are destroyed by public as well as by private extravagance.
This is the tendency of all human governments. A departure from principle becomes a precedent for a second; that second for a third; and so on, till the bulk of society is reduced to mere automatons of misery, to have no sensibilities left but for sinning and suffering... And the fore horse of this frightful team is public debt. Taxation follows that, and in it's train wretchedness and oppression." Thomas Jefferson
Mr. Jefferson was so very correct. Even President John Kennedy said you CAN'T tax your way out of a recession.
Nor can you tax your way out of ever increasing spending. The State budget has grown OVER 40% in the past SEVEN years. A billion dollars a year, with a purposed 12% INCREASE in this years budget.
Two quotes from CATO Briefing Paper No. 53, November 1, 1999 (and still very pertinent!) "The Case against a Tenessee Income Tax," authored by Stephen Moore and Richard Vedder are sufficient to discredit Senator Rochelle's argument.
"The Tennessee budget shortfall has been caused exclusively by excessive spending, not insufficient revenue gains."
"To be precise, from 1992 to 1998 Tennessee revenues rose by 54.5 percent, whereas population and inflation grew by just 24.7 percent."
NAY SAYING NINNY, HORN HONKING NEANDERTHAL, BLED DRY
TAX SERF
Sen David Fowler
sen.david.fowler@legislature.state.tn.us
Three years ago, I was one of the seven state senators who sponsored the resolution that abruptly adjourned the first special session when the talk turned to an income tax. The next year, I filed and argued for 90 amendments to cut the budget. Only 102 were filed, so basically 90% of them were mine. Others who only talk about cutting the budget were unwilling to file such amendments because they didn't want to risk irritating the special interests and groups that would be affected. Last year I worked with Senator Norris and co-sponsored with him more budget cut amendments. In other words, in the last two years I have filed more amendments to cut the budget than all my colleagues combined. I also filed and argued two comprehesive proposals to overhaul TennCare complete with the financial data to support them and even went to the trouble to fly in Richard Teske, a leading adivsor to governments on overhauling medicaid who worked with President Reagan for 7 years as the White House liason to HCFA. None of those efforts got anywhere.
Conservatives are not the political majority in this legislature and we must have a budget and it must be balanced. We cannot even fund last year's budget without an additional $775 million in new funds beacuse last year's budget was balanced using One time tobacco money. That is why, unlike many of my "conservative" friends, I did not vote for last year's budget - it was an instrument of deficit spending like Washington. Now it has come home to bite us. Those are real facts, in the record, about what I have tried to do to haul in spending. We can no longer just sit on our butts and do nothing because we have to have a budget and it must be balanced. I'd suggest that our citizenry send up a little support for the amendments I've filed and my TennCare reform proposals.
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My response: Then why are you calling for more taxes now? As I understand it, your proposal would either take from us more sales taxes or an income tax. The tax stops here.
Yep, I think you got it right.
By Joe White and Skip Cauthorn (The Nashville City Paper)
State Sen. David Fowler Tuesday proposed a new either/or tax that would require a referendum to go into effect.
Voters in November would be asked to choose between a one percent increase in state sales tax rate and a constitutional convention, or a flat-rate 3.25 percent income tax.
The Chattanooga Republican told the Senate Finance Committee that either plan would raise about $1 billion.
The flat-rate income tax would be accompanied by some level of sales tax reduction on food.
Senate Finance delayed any decision until at least next week. Fowler’s background material lacked several definitive figures, including the amount of reduction in the sales tax on food.
Under Fowler’s plan a sales tax would go into effect July 1 to fund the 2002-03 fiscal year budget.
Nov. 2 voters would choose whether to continue the sales tax or scrap it and start a flat-rate income tax on Jan. 1.
Under this plan, as under several others, the current shortfall would be funded out of reserve funds.
The plan is an intricate dance of if/when situations:
1: If the constitutional convention is disapproved, the 3.25 percent income tax solution would go into effect January of 2003. There would be a reduction of the sales tax, local option sales taxes would be removed and a statewide uniform rate would take effect. 2: If the constitutional convention is approved Nov. 2, then the sales tax reform plan (details of which are still unknown) would go into effect Jan. 1, 2003. The convention delegation would be elected in 2004.
3: Delegates would be responsible for devising an alternative to the sales tax reform plan in September of 2004.
4: The convention proposal for tax reform would then go back before voters.
5: If voters approve a convention proposal, final approval could either be done by the legislature or the tax system in place at that time would remain.
Fowler accused anti- and pro- income taxers of “playing chicken” and said his plan would bypass the stymied legislature to let voters decide how to tax themselves.
Support for the plan, said Fowler, was unknown.
“I don’t know what the House will do; I wasn’t elected to the House. Do I have support? I don’t know,” he said. “This is not my thing of choice. Some will think I have lost my conservative principles … I assure you I have not.”
Income tax proponent Bob Rochelle, whose stance is usually opposite of Fowler’s, said leaders should look at the plan.
“It’s something I think we ought to be interested in,” he said. “I compliment you for giving this consideration.”
Wednesday, March 20, 2002
Tennessee to lose tax income because of federal action
By Tom Sharpt Associated Press Writer
NASHVILLE -- Congressional efforts to stimulate the U.S. economy could cost Tennessee up to $125 million in annual tax revenue, a loss the cash-strapped government cannot afford, the Sundquist administration says.
Justin Wilson, chief policy adviser for Gov. Don Sundquist, told the Senate Finance Committee on Tuesday the economic stimulus package signed into law by President Bush a week ago will lower tax collections in Tennessee. Estimates range from $75 million to $125 million a year, he said.
The economic stimulus package allows businesses to depreciate the value of their equipment at a more rapid rate. Depreciation comes off a company's profits, on which the state levies a 6 percent excise tax. The lower the profits, the lower the state's tax income.
Wilson said the National Governor's Association estimates the package will cost Tennessee $262 million over three years.
Since the law is retroactive to Sept. 11, it will affect this year's state budget as well.
Most businesses figure their excise tax obligations on a calendar year, so the last quarter's figures would be reduced. Wilson estimated it could cost Tennessee up to $20 million in the current fiscal year.
The state was already facing a $350 million budget deficit by June 30 because of sluggish tax collections in a slow economy.
Wilson said 20 states base their business taxes on the federal system, and stand to lose money. Democrats in the U.S. Senate estimated the stimulus package would cost states $14.6 billion.
Proponents argued the economic package would stimulate enough economic growth so that state taxes on the new activity would make up for the losses.
Finance Committee member Jim Kyle, D-Memphis, said that argument doesn't apply in Tennessee.
"A lot of the economic activity they're stimulating is service-based activity, which we don't tax," Kyle said. "They're essentially increasing income, which we also don't tax. I don't think there will be enough increased activity to benefit us."
------ On the Net:
Tennessee General Assembly, http://www.legislature.state.tn.us/
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