Grover Norquist Endorses Susan Stimpson in Bid to Defeat Virginia House Speaker Bill Howell

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Posted by Americans for Tax Reform on Tuesday, February 17th, 2015, 10:44 AM PERMALINK


Today, ATR president Grover Norquist released a statement endorsing Susan Stimpson in her bid to defeat Virginia House Speaker Bill Howell in House District 28.  

"In signing the Taxpayer Protection Pledge, Susan Stimpson has demonstrated that she understands the problems of hardworking taxpayers in Virginia. Her written commitment to Virginia voters helps differentiate her candidacy from that of her opponent, Speaker Bill Howell."

Click here to view Susan Stimpson's Pledge to Virginia voters. 

"Speaker Howell is a serial tax-hiker. Ever since he took the helm as the top ranking Republican in Richmond in 2003, Howell has been a major force behind every major tax hike in Virginia.

Under Democrat Governor Mark Warner in 2004, Bill Howell could have prevented a $615 million tax hike. Instead, he convinced Republicans who opposed the tax to take a hike, allowing the vote to proceed and eventually be signed into law."

As PolitiFact Virginia noted, "The bill survived a hostile House committee because Howell persuaded four conservative allies to skip the vote. "

Norquist continued, "The Speaker was even more involved in tax hikes in 2007 under Democrat Governor Tim Kaine. Howell sponsored legislation that raised taxes and fees by $500 million and authorized regional tax hikes amounting to more than $600 million annually. The Supreme Court struck down the regional tax hikes as unconstitutional. 

Speaker Howell’s involvement in both of these tax hikes allowed Kaine and Warner to run for U.S. Senate campaigning as moderates who could work across the aisle with Republicans. Thanks largely to Bill Howell, Mark Warner and Tim Kaine are now U.S. Senators.

Bill Howell wasn’t done. In 2013, Howell sponsored the largest tax hike in Virginia history. He raised the sales tax, property taxes, hotel taxes, hybrid vehicle taxes, and the gas tax all for special spending projects like light rail in Northern Virginia."

The 2013 vote on Speaker Howell's transportation tax hike, House Bill 2313, cost two powerful 20-year incumbents their seats that year. Americans for Tax Reform was proud to support Dave LaRock in particular, in his primary challenge to House Transportation Chair Joe May. 

Norquist concluded, "Howell embodies the type of politician who raises taxes instead of reforming government. For more than a decade, he has caved to special interests by raising taxes instead of using a Republican majority to benefit Virginia taxpayers and small businesses with a pro-growth and limited government agenda.

That is why I am proud to endorse Susan Stimpson in her bid to defeat Bill Howell in Virginia House District 28."

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Dean Fetterolf

Stimpson takes credit for everything, accomplishing nothing in her 2.5 years on BOS except clearly demonstrating she has no clue how to govern. The $7 balance in the Stimpson Stafford Leadership PAC tells us everything you need to know about her leadership skills. She is just running around the state self promoting just like her failed Lt Gov race.

Dean Fetterolf

So you don't even know Stimpson's real record. How much is she paying for the ATR and Norquist endorsement? Or will that be listed as a consultation fee or advertisement in the campaign finance reports?

Dean Fetterolf

Guess you are a paid Stimpson supporter.


ATR Joins ACLU and Institute for Justice in Support of Civil Asset Forfeiture Reform in Virginia

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Posted by Paul Blair on Tuesday, February 17th, 2015, 9:28 AM PERMALINK


Today, Americans for Tax Reform joined the American Civil Liberties Union (ACLU) of Virginia and the The Institute for Justice in support of Virginia House Bill 1287, which would require a criminal conviction before law enforcement may seize and keep an individual’s private property. The legislation, sponsored by Delegate Mark Cole (R-Va.) passed the full House of Delegates by a vote of 92-6 two weeks ago and is up for a vote in the Senate Finance Committee today.

Click here to read the full letter.

In a recent hearing of the U.S. House subcommittee on crime, terrorism, homeland security, and investigations, chairman Rep. F. James Sensenbrenner Jr. (R-Wis.) noted, “The government is seizing billions of dollars of cash and property from Americans, often without charging them with a crime.”

There is a bipartisan consensus on this problem. Rep. Sheila Jackson Lee (D-Texas) said, “The size of these amounts helps put into focus the tension between our property and due process rights on the one hand, and the government’s interest in maintaining this funding stream on the other, often relying on civil forfeiture procedures involving the low standard of proof…Unfortunately, it is increasingly apparent that our laws are not sufficient in this regard.”

The Virginia Beach Police Department seized $6 million in assets between 2008 and 2013. The city Commonwealth’s Attorney said, “it allows us to be able to afford equipment and training for officers and prosecutors.”

As we note in the letter to the legislature, “policing should be based on public safety, not supplementing local law enforcement department budgets.”

Virginia’s civil asset forfeiture laws are among the worst in the nation. The Institute for Justice gave Virginia a D- because of the low burden of proof in forfeiture cases. The state’s laws are ripe for abuse, with countless examples in Virginia of lives being ruined as a result of seize first and make the defendant prove their innocence next protocols.

As the Richmond Times-Dispatch’s A. Barton Hinkle points out, Mark Cole’s legislation “would have saved a lot of misery for people such as Mandrel Stuart, who couldn’t afford to keep his Staunton barbecue business going after police seized more than $17,000 from him in a minor traffic stop. Unlike many in such straits, Stuart did not agree to settle for half his money back and a promise not to sue. He won in court, but still lost his business."

The burden of proof should not be on private property owners to prove to law enforcement officials that their assets were obtained legally; it should be the other way around. 

ATR joins the ACLU and Institute for Justice in urging the Virginia state Senate to pass House Bill 1287.

Click here for a PDF of the letter. 

Photo Credit: 
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Disgraced Gov. Kitzhaber Wasted $350 Million on Unusable Obamacare Website

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Posted by Alexander Hendrie on Friday, February 13th, 2015, 2:16 PM PERMALINK


Oregon Governor John Kitzhaber is running out of friends. On Thursday, Senate President Peter Courtney and House Speaker Tina Kotek – both Democrats – told the Governor he should resign immediately. The governor is facing intense scrutiny over the ethics scandal and criminal investigation into whether “First Lady” Cylvia Hayes improperly used her political influence for financial gain.

Governor Kitzhaber has become embroiled in controversy over allegations that he and his girlfriend misused the office of the governor to further her consulting business. The governor has attempted to cover up his crimes and has been caught trying to destroy thousands of his personal emails even as the governor promised to be “open and honest” with Oregonians. State employees refused to follow his request, rightly recognizing that destroying public records is a criminal offense.

The Governor’s office has already proven its ineptitude with technology.

His administration was responsible for the Cover Oregon fiasco – the State Obamacare exchange website that cost taxpayers $350 million only for the state to then go back to the federal program. The website failed to enroll any Oregonians online weeks after its launch date and instead forced taxpayers hoping to enroll to complete a 20 page paper application.

After failing to create a useable website after two years work and over $300 million in funding, the Kitzhaber administration decided to flee back to the federal exchange – but not after spending millions more in taxpayer funding to do so.

It appeared that the Governor would step down yesterday and Oregon Secretary of State Kate Brown would succeed him (Oregon does not have a Lieutenant Governor). The Governor requested Secretary Brown return from Washington DC immediately, only to tell her that he would not resign, in a “brief” meeting that Brown described as “bizarre”.

Given the governor’s record of mismanagement and corruption, he should resign immediately. Unfortunately, he appears stubbornly determined to remain in office even as his colleagues and the public insist for his resignation.

Photo Credit: 
Oregon Department of Forestry

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Good News

The Governor has announced he's resigning.

Bert

Can you hang the entire Cover Oregon thing around Kitzhaber's neck? Not really. Cover Oregon was a grand plan to try and get everyone in our state signed up for healthscare, as now required by Federal law. Or something. What isn't clear, is whether there'll be a prison term associated with refusing to sign up for this insurance-stuff. At the end of the day, the insurance industry is a very lucrative business to be in, and also investor-friendly. And, that's where it gets interesting, because when you're telling me that not only do I have to carry auto insurance, by law, and car insurance companies are publicly traded and pay dividends, but now you're going to do the same thing to me with medical stuff, well...screw me once, screw me twice, screw me all over again? There's a lot of poor people in our state, and some high-cost, high-maintenance hospitals, too. Poor people can't get into the hospital without some kind of money, typically provided by the state through the Oregon Health Plan. Tax dollars are used to fund the Oregon Health Plan. Insurance payments are chiefly used to fund the stock market, and there's all kinds of exclusions and pre-existing conditions and doctors carrying million in malpractice insurance and other signs of the world of medicine long since having been prostituted out as a lucrative investment opportunity, and the public now forced to participate, so, a de-facto medical tax, and if you'd taken that same couple-hundred million and just spent it directly on providing 'free'(taxpayer-funded) healthcare, a lot more people would have been helped. Instead, Oracle's now trading at 43 bucks a share, likely in no small part due to Oregon's giving them a real financial shot in the arm and thus immunizing them against bankruptcy and honest work of any kind, but not only that, not only that, NOW Oracle has hired attorneys, and wants ANOTHER 23 million in 'unpaid bills' from our state.

So, regardless of whether Dr. K quits or not, can we please have a full, unbiased(as much as possible) accounting of WTF, and also a report on whatever happened to that lady that fled the state in the wake of all this? CO has laid off half their employees, and legislators are gettin' ready to swing the axe. We really care about your health, citizen. No, really, we care lots! Like, 250 million worth. :)))) Your tax dollar, at play!


Senate Introduces Legislation to Keep Internet Access Tax Free

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Posted by Dorothy Jetter on Wednesday, February 11th, 2015, 2:01 PM PERMALINK


On February 10, Senators John Thune (R-S.D.) and Ron Wyden (D-Ore.) introduced S. 431, a bipartisan bill to permanently extend the Internet Tax Freedom Act.  This bill would permanently ban internet taxation in order to ensure the benefits of internet access are readily available.  Last month, House Judiciary Committee Chairman Bob Goodlatte (R-Va.) and Representative Anna Eshoo (D-Calif.) introduced the companion bill, Permanent Internet Tax Freedom Act, H.R. 235, in the House.  

Senator Thune explains:

“For successful 21st century innovators and entrepreneurs, the Internet is their lifeblood. We should be celebrating their success, not taxing the tools they use to achieve it. Our bill, which would permanently ban Internet taxation, would encourage more American innovators and entrepreneurs to use broadband to develop the next big thing, while keeping the Internet open and accessible to consumers across the country. Senator Wyden and I look forward to working with Leader McConnell to bring this bill to the Senate floor.”     

Senator Wyden added:

“I co-wrote the Internet Tax Freedom Act to protect the openness and viability of the Internet as a platform for commerce, speech, and the exchange of ideas.  Without ITFA, access to information would no longer be tax-free. Access to online communication would no longer be tax-free. Access to the global marketplace so crucial to America’s economic future would no longer be tax-free. The cost to consumers could easily be hundreds of dollars a year per household. Now is the time to make this law permanent.”

Americans for Tax Reform supports both S. 431 and H.R. 235 and urges Congress to act swiftly to ensure internet access remains untaxed.   

Co-Sponsors of S. 431 include:

  • Kelly Ayotte (R-N.H.)                        
  • John Barrasso (R-Wyo.)
  • Roy Blunt (R-Mo.)
  • John Boozman (R-Ark.)
  • Richard Burr (R-N.C.)
  • Shelley Moore Capito (R-W.Va.)
  • Christopher Coons (D-Del.)
  • Joe Donnelly (D-Ind.)
  • Dan Coats (R-Ind.)
  • Mike Crapo (R-Idaho)
  • Ted Cruz (R-Texas)
  • Steve Daines (R-Mont.)
  • Deb Fischer (R-Neb.)
  • Cory Gardner (R-Colo.)
  • Lindsey Graham (R-S.C.)
  • Chuck Grassley (R-Iowa)
  • Dean Heller (R-Nev.)
  • Jim Inhofe (R-Okla.)
  • Johnny Isakson (R-Ga.)
  • Mark Kirk (R-Ill.)
  • Patrick Leahy (D-Vt.)
  • Mike Lee (R-Utah)
  • Edward Markey (D-Mass.)
  • John McCain (R-Ariz.)
  • Mitch McConnell (R-Ky.)
  • Jeff Merkley (D-Ore.)
  • Jerry Moran (R-Kan.)
  • Lisa Murkowski (R-Alaska)
  • Patty Murray (D-Wash.)
  • Gary Peters (D-Mich.)
  • Rob Portman (R-Ohio)
  • Pat Roberts (R-Kan.)
  • Marco Rubio (R-Fla.)
  • Charles Schumer (D-N.Y.)
  • Jeanne Shaheen (D-N.H.)
  • Tim Scott (R-S.C.)
  • Jon Tester (D-Mont.)
  • Pat Toomey (R-Pa.)
  • David Vitter (R-La.)

 

Photo Credit: 
Ministerio TIC Colombia

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Americans for Tax Refrom Supports the Mississippi Taxpayer Pay Raise Act

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Posted by Patrick Gleason on Wednesday, February 11th, 2015, 1:04 PM PERMALINK


In a new Forbes column, ATR's Patrick Gleason highlights a pro-growth tax reform proposal unveiled in Mississippi yesterday by Lt. Gov. Tate Reeves (R). Read Gleason's piece below to find out how Lt. Gov. Reeves' proposal, if approved by legislators, would make Mississippi more economically competitive, would increase the job-creating capacity of in-state employers, and would allow Mississippi taxpayers to keep more of their hard earned income.

 

Forbes: Tax Reform Continues To Sweep Through The South

By: Patrick M. Gleason

Today, Mississippi Lt. Gov. Tate Reeves (R) introduced a plan, dubbed the Taxpayer Pay Raise Act, that would reform the state’s tax code in a manner that makes the state more competitive, fosters economic growth, and allow individuals, families, and employers across Mississippi to keep more of their hard-earned taxpayer dollars. The plan is projected to save taxpayers $400 million per year once fully phased in.

One of the most pro-growth aspects of Lt. Gov. Reeves’ proposal is its phase out of the state’s franchise tax, one of the most economical damaging taxes a state could have on its books. David Brunori, professor of public policy at George Washington University and Forbes contributor, explains why franchise taxes are so harmful and even worse than traditional corporate taxes:

“The Mississippi tax is essentially a tax on capital. That is ludicrous in a global economy. Companies in Mississippi pay $2.50 per $1,000 of capital or property, whichever is greater. There is no limit. The more capital employed, the higher the tax.”

Click here to read the rest of the column on Forbes.com

Photo Credit: 
Ana Feliciano

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Boomer Brown

Reducing taxes incents spending and investing which is good for all.

JD

This is not the global economy, it's America....something Grover forgot about...You give more and more to Corporations and they just move it over seas....Where is it we live again Grover?


Government Waste Wednesdays: 370k Spent to Find Mom Loves Family Dog and Children Equally

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Posted by Alexander Hendrie on Wednesday, February 11th, 2015, 10:08 AM PERMALINK


Kids - worried that mom is paying more attention to Fido than she is to you? Well, it turns out the federal government is also interested in this issue – so interested they wasted almost $370,000 on a study to find out who mom loves more. In all, the National Health Institute gave scientists $371,026 to determine whether mothers have the same reaction when looking at photos of their dogs and their children according to retired Senator Coburn’s 2014 Wastebook.

As part of the study, researchers examined and compared brain patterns when mothers see photos of their dog and their children. They found “Mothers reported similar emotional ratings for their child and dog”. According to Senator Coburn’s Wastebook the grant money was intended to go towards “addiction research”, but this was clearly not the case.

This isn’t the first time NIH has wasted taxpayer dollars on bizarre and unnecessary studies. Over the years they have wasted $250,000 on a website showcasing the First Lady’s garden, $1.75 million on a “Hollywood Liaison”, and $325,525 on a study that found couples have happier marriages if they calmed down faster during arguments with their husbands.   

In today’s tight budgetary climate, it is unacceptable that NIH spends taxpayer dollars on such frivolous and comical studies. In fact, the NIH recently complained that budget cuts had delayed the development of an Ebola vaccine. Given they clearly fail to prioritize grant money, it is likely that extra funding would do little towards producing life-saving vaccines. 

Unfortunately for taxpayers, NIH’s wasteful spending doesn’t end there. Next, scientists hope to discover how men and women without children react to babies and pets. 

Photo Credit: 
blhphotography

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Illinois Gov. Rauner Ends the Forced Unionization of Public Employees

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Posted by Will Upton on Tuesday, February 10th, 2015, 4:01 PM PERMALINK


Americans for Tax Reform and the Center for Worker Freedom applaud Illinois Gov. Bruce Rauner for ending the practice of forced unionization for state employees. Enacted by executive order, the Washington Free Beacon notes that Gov. Rauner’s action means: “…public sector workers will no longer be forced to join government unions, such as the politically powerful American Federation of State, County and Municipal Employees (AFSCME) and Service Employees International Union (SEIU), as a condition of employment.”

Matt Patterson, the Executive Director at the Center for Worker Freedom, stated:

Politicians in both red and blue states are at last coming to a consensus that workers deserve free labor markets. 

In the United States, no one should be forced to join or pay dues to any organization, including a labor union.  Gov. Rauner's actions are at odds with labor bosses, who rely on government power to force workers into their ranks.  Fortunately for the rest of us, the Governor's actions are entirely constituent with the U.S. Constitution and freedom of assembly.

The move against forced unionization in Illinois government comes on the heels of a major effort in Kentucky to enact local Right to Work laws. As a state with strong home rule laws, county governments in Kentucky have tremendous power in how local government is run. While the state government remains divided over Right to Work, several counties have undertaken the enactment of local versions of the law – a law that has been passed in 24 states. Writing in Forbes, the Center for Worker Freedom’s Matt Patterson points out:

In a stroke of genius and bravery, county leaders in Kentucky have decided that right-to-work absolutely falls under the “economic development” rubric, because right-to-work attracts businesses and boosts job growth; according to Bureau of Labor Statistics (BLS) data, between 1990 and 2014 jobs grew more than twice as fast in right-to-work states compared to their less-free brethren.

So Kentucky county officials figure they can and should pass right-to-work at the county level. And as of this writing, five have done so, a pro-worker blitzkrieg that advanced through Todd, Fulton, Warren, Simpson and Hardin counties in barely one month as last year gave way to this.

Most importantly, Gov. Rauner has extended the freedom of association to Illinois state employees, giving them the freedom to choose whether or not they wish to be a part of a public employee union. A right that is all-the-more important when one realizes most Illinois unions fail to meet typical non-profit standards for spending. The Illinois Policy Institute points out:

Nonprofits in Illinois typically spend around 90 percent of their budget on their missions, with the remainder going to overhead and administration.

Meanwhile, all but one of Illinois’ major government unions fail to reach the Better Business Bureau’s standard, by the unions’ own accounting.

For instance, the Illinois Education Association, or IEA, the state’s biggest teachers union, devoted just 26 percent of its budget to representation in 2014. Nearly 70 percent went to administration and overhead and 3 percent went to political activities, according to LM-2 reports filed with the U.S. Department of Labor in 2013.

Americans for Tax Reform encourages more governors across the country to follow Gov. Rauner’s lead and end the forced unionization of public employees.

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ATR Supports Tax Relief for Working Parents


Posted by Ryan Ellis on Tuesday, February 10th, 2015, 1:36 PM PERMALINK


Last week, H.R. 750, the “Family Care Savings Act” was introduced in the U.S. House of Representatives. This legislation will make improvements to dependent care flexible spending accounts (FSAs) and help Americans manage the rising costs of raising a family. ATR endorses this bill and urges members of the House to support this legislation.

H.R. 750, introduced by Representative Patrick McHenry (R- N.C.) and Representative Grace Meng (D- N.Y.) raises the cap on dependent care FSAs from $5,000 to $10,000 and indexes it to inflation after the first year of enactment. These FSAs allow employees to save part of their pre-tax earnings for specific expenses including medical and dependent care. Dependent care FSAs can be used for children under the age of 13, anyone who is physically or mentally unable to care for themselves, or any adult whose care is predominantly paid for by another person.

This legislation will provide a much needed update by increasing the current cap which was set almost 30 years ago when dependent care FSAs were first created in 1986. H.R. 750 will improve dependent care FSAs and help families plan and budget for the expenses of caring for children, disabled spouses, or elderly parents.

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ATR Opposes House Bill 170's Massive Gas Tax Increase in Georgia

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Posted by Paul Blair on Tuesday, February 10th, 2015, 7:48 AM PERMALINK


In the aftermath of a joint legislative study committee report on transportation, Georgia lawmakers have spent the last month figuring out how to extract more money from taxpayers to pay for transportation projects. The report called for at least $1-1.5 billion in additional spending annually. To address “the full universe of transportation needs, including establishment of passenger rail systems,” the report claimed the state would need between $3.9 and $5.4 billion annually, constituting a 20 percent increase in the total state budget.

Georgia House Bill 170, which is supported by Republican Gov. Nathan Deal and House Speaker David Ralston, would raise at least $1 billion per year by making a number of changes to the state gas tax. Gasoline in Georgia is subjected to an excise tax of 7.5 cents per gallon, a 4% sales tax and in most places another local sales tax of 3%-4%. Under H.B. 170, this mix of taxes would be converted to a 29.2 cents per gallon tax, indexed to inflation. This is a tax increase that rises year by year. 

As Tom Crawford with the Gainesville Times noted, “the current mix of excise and sales taxes on gasoline totals roughly 27 cents per gallon.” By indexing the gas tax to inflation and increasing the tax by more than 2 cents per gallon, H.B. 170 is clearly a tax increase.

Drivers of hybrids aren’t forgotten. The bill imposes a car tax hike on alternative fuel vehicles of between $200-$300 per year, indexed to inflation. Virginia’s 2013 transportation tax hike did this as well until Democrat Governor Terry McAuliffe repealed the tax less than 6 months later.

H.B. 170 also engages in an inventive gimmick to generate $500 million in new revenue. By immediately absorbing local gasoline sales tax revenue, the state will now collect and spend money otherwise collected and spent by localities. Most localities spend this money on a bevy of non-transportation needs, like education. Absent the willpower to cut spending though, it is likely local governments will consider tax hikes in the future.

Upon the expiration of local sales taxes on gasoline, H.B. 170 permits localities to raise the local excise tax on gasoline by up to 3 cents per gallon before requiring that further gas tax hikes be approved by referendum for a maximum of 6 cents per gallon in local taxes. This sets in motion future tax hikes, not all of which even need voter approval.

While we take no position on the state absorbing local tax revenue streams, directing gas tax revenue to transportation projects instead of unrelated spending programs like education, should be applauded. In 2014, by a 80-20 margin Wisconsin voters passed a ballot initiative requiring gas tax revenue be spent on transportation. Consumers' expectations on gas tax revenue are clear: spend it on transportation and nothing else. Unfortunately, the definition of "transportation" is broad and encompasses a number of expensive projects, all of which may not actually alleviate traffic to improve anyone's commute to work. 

So what would the total gas tax bite be if H.B. 170 passed in Georgia? 

Tax Collector

Present Law

H.B. 170

Future

Total Tax Possible

Federal

18.4 cents/gallon

NA

NA

18.4 cents/gallon

State

7.2 cents/gallon + 4% sales tax

29.2 cents/gallon

Chained to CPI

*29.2 cents/gallon

Local

3%-4% sales tax

Up to 3 cents/gallon

Up to 6 cents/gallon

6 cents/gallon

 

45.4 cents/gallon

   

*53.6 cents/gallon

*Chaining the tax to inflation guarantees additional increases
Americans for Tax Reform opposes H.B. 170. Not only does the bill result in an immediate gas tax hike, it gives local governments free rein to raise local gas taxes in the future. The total tax on gasoline in Georgia could range as high as 53.6 cents per gallon, well above the U.S. average of 48.29 cents per gallon. If implemented, H.B. 170 could make gasoline sold in Georgia, the 9th highest taxed gasoline in the nation. Indexing the gas tax to inflation would make it worse. 
 

ATR urges the legislature to revisit its transportation spending priorities and reject all gas tax hikes on consumers. 

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tompro97


They are trying to sneak this through like they did TSPLOST - we senior citizens simply CANNOT afford to pay any more taxes than we already are.

Joel Brothers

If they raise gas taxes, I will do everything legally in my power to see that they are unemployed come next election. Enough is enough.


Governor Paul LePage Calls for Elimination of Maine's Income Tax

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Posted by Paul Blair on Tuesday, February 10th, 2015, 6:15 AM PERMALINK


In his 2015 State of the State Address, Gov. Paul LePage (R-Maine) called for an elimination of the state income tax "once and for all." A significant potion of LePage's speech was dedicated to a tax reform proposal that he announced last month. Here are some highlights:

"Maine is currently not competitive nationally or globally. Our tax system is antiquated. We must modernize it.

My fellow Mainers, you work hard for your paycheck. The government takes your earnings, and you have no control over how it is spent.

You earned it. You should keep it!

An income tax cut puts money back in your pocket. It is a pay raise for all working Mainers...

This plan is different from past plans. It is not a tax shift. It is a tax cut for all Mainers.

My vision is a Maine with no income tax. But I’m no magician. It takes time.

When I took office, Maine’s top income tax rate was 8.5 percent—one of the highest in the nation.

We reduced the rate to 7.95 percent—a baby step. This plan cuts it to 5.75 percent—a 40 percent decrease in the income tax since I took office. That’s one big step.

A young married couple, both teachers with one child, claiming a standard deduction, would get a $1,500 pay raise.

That’s a mortgage payment. That’s few tanks of heating oil. It’s several car payments or back-to-school clothes for the kids. It’s real money. It makes a real difference...

This plan reduces the tax burden on Maine families and small businesses by $300 million. That’s a real pay raise for the Maine people!..

There are 9 states with no income tax. 19 other states are working to reduce or eliminate the income tax. Maine is leading the nation with our bold plan. We’re the first out of the chute...

Maine’s corporate tax is a job killer. My plan cuts it. We also eliminate the Alternative Minimum Tax."

Gov. LePage's plan would reduce the top corporate tax rate from 8.93% to 6.75% and exempt the first $48,000 of income for a family of four from the state's income tax. He also eliminates the death tax and the tax on pensions. While his plan eliminates a number of exemptions and adds the sales tax to a number of services, this $219 million revenue increase is more than offset by his other tax reductions. LePage's plan reduces net taxes by $300 million annually when fully phased in. 

Click here to read Governor LePage's budget. 

This isn't Gov. LePage's first tax reform proposal. As he noted in his speech, in 2011, LePage successfully reduced the state income tax top rate from 8.5 percent to 7.95 percent. His most recent plan eliminates a range of credits and deductions and when fully phased in will result in $1.2 billion in income tax cuts over the 2018-2019 biennium.

Source: State of Maine Biennial Budget Briefing 

LePage's plan also reduces the number of corporate income tax brackets and reduces the top rate from 8.93 percent to  6.75 percent by 2020, resulting in a $50 million tax cut by 2019. 

While the long list of tax cuts and changes to the tax code are an important step in simplifying Maine's tax code to make it flatter, fairer, and lower, perhaps the most significant proposal came at the end of LePage's State of the State Address:

"We must make sure the income tax keeps going down every year until it is gone.

I ask for a constitutional amendment that will direct all growth in revenue to go toward eliminating the income tax—once and for all."

Americans for Tax Reform is a big proponent of revenue triggers, which pay for long term tax cuts through economic growth. Instead of immediate tax cuts that could require spending restraint or tax shifting, revenue triggers like the one Gov. LePage has called for set, as a matter of law, new revenue generated through economic growth aside for rate reductions. Instead of states squandering budget surpluses on long term spending programs, all new state revenue above an amount set by the state is calculated as a percentage of a tax cut (income in this case). 

North Carolina established revenue triggers as a means for reducing the state's corporate rate and Kansas enacted revenue triggers for the income, corporate, and banking tax. In Kansas, it will take the House, Senate, and Governor to reverse the long term goal of eliminating each of these taxes. For more information on revenue triggers, read our brief here

We applaud Governor Paul LePage's bold tax reform proposal and encourage the legislature to adopt both it and his plan to fully phase out the income tax.

Photo Credit: 
Chris Sweet, Maine Public Broadcasting

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