Kelly William Cobb
Georgia Committee Votes to Expand Telecom Slush Fund
In early February, the Georgia House Telecommunications Subcommittee considered a bill (HB 168) that would completely scrap the Universal Access Fund (UAF). The UAF costs consumers and businesses in Georgia millions per year to subsidize inefficient telecom providers in rural areas.
But just when reform looked to be on the way, today the House Telecom Subcommittee passed House Bill 376 that would expand the size of the fund to $25 million from the current level of $10 million. Even worse, the bill is being dubbed the major reformpackage from Georgia's telecom system.
Below is ATR's letter opposing expansion of the UAF. Click here for a PDF copy.
Chuck DeVore to Chair Taxpayer Protection Caucus in California Assembly
Today, Americans for Tax Reform announced that Assemblyman Chuck DeVore (R - Irvine) will chair the Taxpayer Protection Caucus in the California State Assembly. The Caucus consists of all signers of the Taxpayer Protection Pledge and provides a single voice on tax issues among pro-taxpayer legislators. With the addition of Assemblyman DeVore, there are now 37 active caucuses in 29 states. From ATR's press release:
Minnesota Seeks "Amazon Tax"
“Imposing a download tax on users of one of the most important and thriving areas of our economy will only stifle ecommerce and harm consumers,” said Derek Hunter, executive director of the Media Freedom Project. “The free marketplace of the Internet can be the road map that leads us out of economic stagnation and recession. This bill will end up being nothing more than a roadblock on the path to recovery, not part of a cure.”
To Wither or Rectify the Old Line State?
Last week, the Maryland House Ways and Means Committee held hearings on a number of bills that could either rectify or continue the Old Line State's recent plunge in their tax climate. On Thursday, the committee considered whether to establish a Taxpayers' Bill of Rights (TABOR), which would tie state spending to population and inflation growth. The measure was sponsored by House Taxpayer Protection Caucus Chair Warren Miller. From ATR's testimony in support of House Bill 421:
For a PDF of ATR's TABOR testimony, click here.
Also before the committee last week was a bill to make Maryland part of the Streamlined Sales Tax Project, a tax and spend cartel that aims to extend tax collection on consumers and businesses by sneakily eliminating current exemptions and expanding what items can be taxed. From ATR's testimony:
The streamlined sales tax is not revenue neutral and states that have adopted it have automatically raised taxes on consumers and businesses by hundreds of millions of dollars. By signing up for the SST, Maryland would adopt a tax code that mirrors other states, thereby expanding the list of taxable items to currently untaxed goods. For example, when Minnesota implemented the SST, the new definition of “sales tax” broadened Minnesota’s sales tax to include shipping, handling, and postage, which was previously untaxed by the state. Now, Minnesota consumers pay a new tax on goods purchased outside of the state and higher prices for goods purchased in the state due to the tax raising the cost of transportation.
For a PDF of ATR's testimony opposing the streamlined sales tax, click here.
Kentucky Hikes Alcohol and Tobacco Taxes
Last week, Kentucky thanked the bourdon industry for putting the Bluegrass State on the map by giving them the highest distilled spirits tax in the country. And why not double the cigarette tax while you're at it?
That's right. Last week the House and Senate passed House Bill 144 to apply the state's 6% sales tax to beer, liquor and wine sales (in addition to the current 11% gross receipts tax) and to raise the cigarette tax by another 30-cents per pack. Governor Steve Beshear (D) quickly and cheerfully signed the bill, even though he was seeking a much higher 70-cent per pack cigarette tax hike. The measure was part of a plan to eliminate the state's $459 million overspending problem.
As two-dozen alcohol beverage delivery trucks circled the Capital and hundreds gathered on the Capital steps to pour out liquor in a Whiskey Rebellion protest, lawmakers in each chamber called the tax hike a measure of last resort - then narrowly passed it. They apparently neglected to account for the fact that the state's budget has ballooned by 21% since 2006 alone. The other option was simple: trim excessive spending.
Consumers across the country already spend 79.6% of the cost of distilled spirits and 56.2% of the cost of beer paying for government taxes and fees. Even worse, 81.3% of the price of cigarettes goes toward state and federal taxes.
Click the following links for PDF letters submitted to legislators throughout the week:
Arkansas Passes Cigarette Tax Hike
Georgia Legislature Weighing Cigarette Tax Hike
With $2 billion in overspending estimated for this year, Georgia has joined a disturbingly long list of states looking to smokers to help fill state coffers. House Bill 39 would raise the cigarette tax by $1 per pack and hike the tax on smokeless tobacco products by 150%.
Georgia’s nearby states have an average cigarette tax of just 36-cents per pack. If the tax hike is passed, Georgians will have to pay $1.37 per pack, nearly quadruple that of their neighbors. In a similar situation, Maryland raised the tobacco tax last year to cover a budget projection shortfall. However, the problem was only made worse when sales fell 25% after consumers drove to nearby states with lower tax rates.
Click here for ATR's letter to Georgia Taxpayer Protection Pledge Signers.
Arkansas House Adopts $88 Million Cigarette Tax Increase
Last week, the Arkansas House of Representatives voted to increase the state's cigarette tax by 56-cents per pack. The $88 million tax hike got 75 votes - the exact number necessary to pass the bill. The tax hike was prompted by calls from Governor Mike Beebe (D), who argued the revenue was necessary to expand the state's trauma system, and immediately followed a 61-cent increase in the federal excise tax signed by President Barack Obama. Click here for a PDF version of ATR's legislative alert to the Arkansas House opposing House Bill 1204.
The Arkansas Senate Revenue and Taxation Committee is expected to consider HB 1204 this Wednesday with a final Senate vote by the end of the week. Below is ATR's letter to Arkansas Senators encouraging them to oppose the tax hike.
It is critical to stand up for consumers and taxpayers in opposition to tax increases. In this economic downturn, the burden of larger government will only further depress economic activity. Instead, the state would do well to take a lesson from Arkansas families, who are cutting back their spending habits. If you have any questions, please contact Kelly Cobb or Nathan Pick, state affairs managers, at (202) 785-0266.
Click here for a PDF version of the Senate letter.
Georgia House Considers Scrapping the Universal Access Fund
The Georgia House Telecommunications Subcommittee held a hearing this week to consider reforms to the state's telecom system. At the center of the discussion is House Bill 168, which would eliminate the state's costly and inefficient Universal Access Fund (UAF).
The UAF costs consumers and businesses in Georgia over $15 million per year to subsidize inefficient telecom providers in rural areas. The UAF slush fund has also become fraught with waste and abuse, leading to tens of thousands of dollars in payments to telecom companies for items completely unrelated to providing service - like reroofing cabins and throwing extravagent Christmas parties.
ATR submitted the following testimony to the Georgia House Telecommunications Subcomittee in support of HB 168 or for establishing reverse auctions to cut down excessive UAF costs.
Stop the $2 Billion Tax Hike in Oregon
This month, the Oregon legislature reconvened to discuss a multi-billion dollar budget shortfall. Unfortunately, now Governor Kulongoski and Oregon legislators are pondering $2 billion in taxes hikes on gas, cigarettes, health care providers, and corporations, and another $1 billion in additional spending – the same spending that caused the state’s current budget crunch. In fact, Oregon has increased spending by a staggering 22.6% since 2003 alone.
Oregon residents take action now! Click here to write your state legislators and governor and tell them that tax hikes will do more to slam families, consumers and businesses than they will to recitify the state's budget woes.
ATR and the Taxpayers Association of Oregon sent a letter to all Oregon lawmakers and the governor urging them to oppose tax hikes to solve the state's massive overspending problem. The joint letter is below.
Click here for a PDF version of the letter.