January 18, 2011

Virginia Senate

Virginia House of Delegates

Dear Legislator,

Now that the General Assembly has convened for the 2011 session, calls for tax increases are already arising.  I urge you to reject any and all tax increases that are presented to you.    There is never a good time for a tax increase, but now as you work to get this economy moving, it would be most detrimental to any prospect of economic growth and job creation.  On November 2^nd, all over the nation and in the Commonwealth of Virginia the voters spoke resoundingly against higher taxes and spending; I would urge you to guard against forgetting their voices during the session.      

As you worked to erase an overspending problem in the 2010 session, I urge you to continue to address this problem in the 2011 session.  Currently, there are some pieces of legislation that would only be patching the problem with tax increases, rather than curtailing spending and eliminating inefficiencies.   Americans for Tax Reform stands firmly with Virginians all over the Commonwealth in firm opposition to any and all of these tax increases.  A couple of pieces of legislation raising concern are the following two, though this list is not comprehensive: 

• House Bill 2341 sponsored by Delegate Morissey:  This bill would levy a twenty cent tax on plastic bags in the Commonwealth of Virginia and levy fines on retailers who do not comply with collecting the new tax.  This is an uncanny attempt to implement a social engineering project and eradicate plastic bags while also taking more money from the pockets of Virginians.  Furthermore, there is no evidence to suggest that plastic bag taxes improve the environment.
   
• House Bill 1604 sponsored by Delegate Dave Albo:  This bill would change rules that relate to the collection of corporate income taxes.  This bill attempts to level the playing field between Virginia businesses and out-of-state businesses, but ends up being a net tax increase overall.  This bill could be fixed by amending it to be revenue neutral; one way this could be done is by cutting the corporate income tax rate.         

There are a couple other issues that I would like to address, one being Governor McDonnell’s transportation plan and the other being one of the ways he looks to fund the plan, namely through the partial privatization of ABC.

First, privatization of liquor industry is an important goal.  In principle, ATR fully supports privatization of ABC and other entities.  The current plan Governor Bob McDonnell is proposing would privatize the retail side of liquor sales.  From what has been released so far, this plan does not contain tax increases.  Eventually, total privatization of ABC should be the goal of the Commonwealth, but this ideal should not stand in the way of a step in the right direction.

Secondly, transportation is an ongoing issue in the Commonwealth of Virginia and in many states around the country.  Governor McDonnell is looking to borrow about $4 billion in order to fund his transportation plan.  It is fair to discuss whether or not this is good policy for the Commonwealth of Virginia, but I want to make clear that there is not a tax increase in this proposal.  However, if this new bonding moves forward, assurances need to be made that this new spending will not lead to tax increases in the future.  The Governor’s proposal does not include a net tax increase and would not violate the Pledge.

Please join the families of Virginia who are working to find ways to make due with less.  As they are finding ways to cut their budgets, I urge you to join them in doing the same.  If you have any questions, please contact Nathan Pick, state affairs manager, at 202.785.0266.  

Onward,

Grover Norquist

CC: Governor Bob McDonnell

For a PDF copy of the letter, click here.