Margaret Mire

Taxpayer Win in Utah: Voters Chip Away at Income Tax Earmark – Amendment G

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Posted by Margaret Mire on Thursday, November 12th, 2020, 2:08 PM PERMALINK

Utah voters approved Amendment G, which appeared on the general election ballot. This taxpayer win is a great first step towards ending an antiquated approach to managing the state budget.

Since Utah has had an income tax in place, 100% of income tax revenue has been earmarked for ‘education.’ This bizarre arrangement, which is almost exclusive to Utah (Alabama has a similar earmark), has resulted in Utah state government costing more than it should and would otherwise be the case.

Despite the fact that Utah has experienced significant surpluses in income tax revenue – roughly $1 billion in 2019 alone – not a single dollar could be used to cover other parts of the budget. As a result, other taxes have remained higher than “necessary” since income tax revenue could not go towards any other government programs.

This arrangement has also made it incredibly difficult to deliver pro-growth tax reform that reduces, or ideally phases out, the state income tax. “This [earmarking all income tax revenue for education] means the most powerful lobby in Utah – the teacher’s union – is an opponent of all pro-growth reductions in the state income tax burden,” explained Grover Norquist in an OpEd in UtahPolicy.com.

Amendment G, which won about 54% of the vote, starts to chip away at this earmark on income tax revenue. Thanks to Amendment G, income tax revenue can also be used to fund programs for children and the disabled. Not just education.

This reform, which will offer greater flexibility in the budgeting process, will allow hard earned taxpayer dollars to be used more efficiently and reduce the threat of future tax increases. It may even facilitate lower tax rates.

Photo Credit: Curtis Fry


Arizona Slated for Massive Income Tax Hike -- Prop 208

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Posted by Margaret Mire on Friday, November 6th, 2020, 2:46 PM PERMALINK

Arizona voters have unfortunately approved Proposition 208, a measure that was heavily funded by out of state interests and will result in the hardworking taxpayers across the Grand Canyon State facing a permanent $1 billion income tax hike. Legal challenges against Prop. 208 are likely to ensue. 

Prop. 208 will impose a new 3.5% “surcharge” on single filers who earn more than $250,000 a year and married couples who earn more than $500,000. This amounts to a whopping 77.7% tax increase, giving Arizona the unwelcome distinction of being home to one of the highest income rates in the country. 

“Backers of Prop. 208 have been claiming this massive increase in Arizona’s top marginal individual income tax rate would only impact ‘the rich.’ But that is not true,” wrote Grover Norquist, president of Americans for Tax Reform, in an OpEd that warned of the serious negative consequences of this measure. “Prop. 208 proponents ‘forget’ to mention that small business owners also pay individual income taxes. In reality, around 50% of those whose tax rates would be targeted are small businesses, many of whom have already been struggling from weeks of forced shutdowns to slow the spread of the coronavirus.”

Adding insult to injury, Prop. 208 is also going to jeopardize future jobs and opportunities for Arizonans. “[I]t has been well documented that income tax rates are a key determinant of business location and investment,” wrote Norquist. Prior to Prop. 208, Arizona’s top marginal individual income tax rate of 4.5% was fairly competitive. Once Prop. 208 takes effect, Arizona’s new rate of 8% will rank 10th highest in the country and 2nd highest in the region. “Why would anyone want to invest in Arizona when there are so many other states that would allow them to keep more of their hard-earned money,” said Norquist.

Prop. 208, the so-called “InvestInEd” measure, will devastate Arizona’s economy, while doing nothing to actually improve education. “It would not expand parental choice. It would not call for higher standards. It is basically a slush fund for bureaucrats,” explained Norquist. “Giving all parents and students – regardless of income or address – the ability to choose the school that works best for them is the best way to improve education and education outcomes.”

A glimmer of hope for Arizona taxpayers is that legal challenges are likely to be filed against Prop. 208. There is still a chance that this massive tax increase – the largest in Arizona history – may not take effect.

Photo Credit: Neepster


Taxpayer Protection Pledge Signer Governor Chris Sununu Wins Reelection in New Hampshire

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Posted by Margaret Mire on Wednesday, November 4th, 2020, 4:21 PM PERMALINK

Americans for Tax Reform congratulates New Hampshire Governor Chris Sununu on winning reelection.

Gov. Sununu signed the Taxpayer Protection Pledge back in 2016, when he first ran for governor, making a written promise to the people of New Hampshire that he will oppose and veto any and all tax increases. While in office, Gov. Sununu has stood strong against the many Democrat-led efforts to raise taxes.

Underscoring his commitment to taxpayers, Gov. Sununu and New Hampshire Attorney General Gordon MacDonald recently filed a lawsuit in the United States Supreme Court against Massachusetts, whose Department of Revenue is actively trying to export taxes onto Granite Staters. For more information on this dangerous tax grab by Massachusetts, read Grover Norquist’s, president of Americans for Tax Reform, OpEd in the Union Leader here.

“Gov. Sununu is a true ally to New Hampshire taxpayers,” said Norquist. “From Democrats in the state legislature to the tax collectors in Massachusetts, Gov. Sununu always puts up a strong fight against anyone who tries to take more hard-earned tax dollars from New Hampshire taxpayers.”

Now, when lawmakers convene next legislative session to tackle a number of issues brought on by the Coronavirus, New Hampshire taxpayers can rest easy knowing that they still have an ally in the Governor’s mansion. In addition, the New Hampshire General Court flipped back to Republican control, with a number of pledge signers in both the state house and state senate. 

Americans for Tax Reform offers the Pledge to all candidates for state and federal office. In addition to Gov. Chris Sununu, 12 other sitting governors are signers of the Taxpayer Protection Pledge.

New candidates sign the Taxpayer Protection Pledge regularly. For the most up-to-date information on these races or any other, please visit the ATR Pledge Database.

 

Photo Credit: James Walsh


Arkansas "Temporary" Sales Tax Made Permanent

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Posted by Margaret Mire on Wednesday, November 4th, 2020, 12:30 PM PERMALINK

Arkansas voters have unfortunately approved Issue 1, a sales tax increase.

Americans for Tax Reform opposed this measure. Issue 1 will permanently increase Arkansas’s sales tax rate by 0.5 percentage points or 8.33%, resulting in Arkansas having one of the highest combined state and local sales tax rates in the country.

In 2012, Arkansas voters approved a “temporary” sales tax increase of 0.5 percentage points that was supposed to expire in 2023. Issue 1 will now make that tax hike permanent, which, contrary to many claims, is, in fact, a tax increase.

“Sadly, Arkansas saddled itself with a sales tax increase that was originally peddled by the state legislature and governor as temporary,” said Grover Norquist, president of Americans for Tax Reform. “Now, the Governor decided that promises to his voters are old fashioned. He broke his word and put a referred question that would make the “temporary” tax hike permanent. For ever and ever and ever.”

For further details, see ATR president Grover Norquist's op-ed here.

Photo Credit: Jimmy Emerson


Michigan Voters Approve Requiring Warrants for Electronic Data--Proposal 2

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Posted by Margaret Mire on Tuesday, November 3rd, 2020, 10:30 PM PERMALINK

In a state ballot measure, Michigan voters have approved Proposal 2.

Americans for Tax Reform supports the measure. It amends the state constitution to require authorities get a search warrant to access a person’s electronic data and communications.

Photo Credit: David Marvin


Amendment G Would Alleviate Utah’s Budget Woes

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Posted by Margaret Mire on Tuesday, October 13th, 2020, 1:31 PM PERMALINK

On Election Day, the people of Utah will have an opportunity to reduce their odds of facing future tax increases by ensuring their hard-earned tax dollars are used more efficiently. Amendment G, if approved by the voters, would be a great first step towards ending an antiquated approach to budgeting in Utah. 

Since Utah has had an income tax in place, 100% of income tax revenue has been earmarked for ‘education.’ This bizarre arrangement, which is almost exclusive to Utah (Alabama has a similar earmark), has resulted in Utah state government costing more than it should and would otherwise be the case. 

Despite the fact that Utah has experienced significant surpluses in income tax revenue – roughly $1 billion in 2019 alone – not a single dollar could be used to cover other parts of the budget. As a result, other taxes have remained higher than “necessary” since income tax revenue cannot go towards other government programs.

“Utah’s legislature has been forced to contort the budget in countless ways over the decades because of the earmark on income tax,” said Rusty Cannon, Vice President of Utah Taxpayers Association. “The duct tape and bailing twine that they are forced to creatively use every year will stop working in the near future. It makes no sense to have a state with such a strong economy and robust tax revenues hamstrung like this."

Adding insult to injury, this arrangement has also made it incredibly difficult to deliver pro-growth tax reform that reduces, or ideally phases out, the state income tax. “This [earmarking all income tax revenue for education] means the most powerful lobby in Utah – the teacher’s union – is an opponent of all pro-growth reductions in the state income tax burden,” explained Grover Norquist in an OpEd in UtahPolicy.com.

While Utah does have a flat income tax, its rate of 4.95% is not incredibly competitive. Nine states do not impose taxes on wage income, two of which – Nevada and Wyoming – are Utah’s neighbors. Colorado, New Mexico, and Arizona, all of which also border Utah, have lower top marginal individual income tax rates of 4.63%, 4.90%, and 4.50%. And, there is a measure on Colorado’s ballot this year that would further cut its flat income tax rate. Clearly, there is plenty of room for Utah to improve.

Fortunately, Amendment G would start to address Utah’s budget woes. If approved, Amendment G would allow income tax revenue to also be used to fund programs for children and the disabled. Not just education.

This reform, which would offer greater flexibility in the budgeting process, would result in hard earned taxpayer dollars being used more efficiently, reducing the threat of future tax increases and maybe even facilitating in lower tax rates.

Photo Credit: justgrimes


Louisiana Constitutional Amendment 4 Would Rein in Wasteful Spending

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Posted by Margaret Mire on Friday, October 9th, 2020, 4:48 PM PERMALINK

On Election Day, millions of Americans will head to the polls to vote for who they want to be President of the United States. However, that is not the only important decision they will be making.

Along with choosing their preferred candidates for public office at the federal, state, and local levels, voters in many states will also face one or more ballot measures, which will shape their state for years to come. 

In Louisiana, Constitutional Amendment 4, also titled Expenditure Growth Limit, is one of several measures that will appear before Pelican State voters. If approved, Amendment 4 would replace the current expenditure limit formula in the state constitution with a more effective formula that was approved by the legislature earlier this year, and an absolute cap of 5%.

Currently in Louisiana, state spending growth cannot exceed the prior year’s spending limit multiplied by the “growth factor,” which is defined as “the annual percentage rate of change of personal income for Louisiana as defined and reported by the United States Department of Commerce for the three calendar years prior to the fiscal year for which the limit is calculated.”

While it is great that Louisiana has a spending cap, it has not been incredibly effective at actually keeping the size of government in check. 

“Louisiana's status quo approach to budgeting has led us lurching from one fiscal cliff to the next, with little accountability for how taxpayer dollars are being spent,” Daniel Erspamer, CEO of the Pelican Institute for Public Policy, said. “Over the last few years, Louisiana’s general fund has grown by nearly 12 percent, while our population has decreased and economic growth indicators have remained flat, at best."

Amendment 4 would help rein in Louisiana’s spending problem by replacing the current spending cap with one that is much stronger. 

Specifically, Amendment 4 would give the legislature the authority to “establish by law a procedure to determine the expenditure limit which shall not provide for growth in the expenditure limit of more than 5% in any year.” Any changes to this law would require 2/3 support in both the House and the Senate. 

The expenditure limit formula that would be put in place following approval of Amendment 4 was already approved by the legislature earlier this year without a single NO vote. The proposed expenditure limit formula – Rep. Beau Beaullieu’s (R) House Bill 464, now Act 271 of the 2020 Regular Session – would build upon Louisiana’s current limit by also including growth of Louisiana’s GDP, state population, and changes to the regional inflation rate along with personal income growth in the formula. 

“This is an opportunity to add predictability and stability to our antiquated budget process,” said Rep. Beaullieu. “As we make our budget more predictable, we will be able to better plan for the future and encourage job growth that provides a better life for working families across Louisiana.”

The status quo in Louisiana has allowed spending to increase well beyond the rate of population and inflation. On November 3rd, Louisianans have the opportunity to send a clear message to lawmakers. By approving Amendment 4, Louisiana taxpayers can say that they want their tax dollars to be used efficiently. They can say no more wasting our hard earned money on bloated spending programs.

Photo Credit: Pxhere


Six Things States Can Do to Promote Private Sector Investment in Broadband

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Posted by Margaret Mire on Friday, August 14th, 2020, 12:26 PM PERMALINK

Thanks to $1.7 trillion in investment from the private sector, 94% of Americans have access to high speed internet. While this is a great accomplishment, bringing access to the 6% of unserved Americans is still a priority for all.

As many state and local officials across the country have learned the hard way, government entities are not suited to take on this task. “Dozens of local governments have tried to build out broadband networks over the years,” explained Grover Norquist, president of Americans for Tax Reform. “These massively subsidized efforts attracted corruption, did not deliver on promises, and where they did not fail outright, had to be propped up with even more tax dollars.”

The private sector is best positioned to bring access to unserved communities. A new paper by Americans for Tax Reform, Six Things States Can Do to Promote Private Sector Investment in Broadband, details six ways state lawmakers can remove some of the government barriers that inhibit private sector investment in broadband.

To view the paper, please click here.

Photo Credit: Nenad Stojkovic

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Judge Rules Misleading Tax Measure Cannot Appear on AZ Ballot

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Posted by Margaret Mire on Friday, August 7th, 2020, 3:02 PM PERMALINK

In a big win for Arizona taxpayers, Maricopa County Superior Court Judge Christopher Coury ruled that a nearly $1 billion income tax hike cannot appear on the November ballot due to its misleading language.

Backers of the Invest in Education initiative said it would have imposed “a 3.5% surcharge on taxable income above (a) $250,000 annually for single persons or married persons filing separately, and (b) $500,000 annually for married persons filing jointly or head of household filers.” Three and a half percent sounds like almost nothing, but as the Judge pointed out, that is shockingly and deliberately dishonest.

“Invest in Education circulated an opaque ‘Trojan horse’ of a 100-word description, concealing principal provisions of the initiative,” said Coury in his 20-page ruling. One of his main concerns with the initiative is its use of the word “surcharge” in the description.

“Although the use of the term ‘3.5% surcharge on taxable income’ may be perfectly understood by some Arizona voters to be permanently adding 3.5 percentage points to the taxation rate – an increase 77.7% in the tax rate on taxable income above the threshhold – others reasonable Arizona voters may understand a “surcharge” to mean a temporary tax, or to mean a modest 3.5% increase of the existing tax rate,” explained Coury. “The use of the term ‘surcharge’ creates a substantial likelihood of confusion for a reasonable Arizona voter.”

Coury also noted that the description fails to inform voters that the proposed tax increase would apply to more than just the “wealthy.” It would also apply to a number of small businesses, which are already struggling from the pandemic. Coury explained:

“Under applicable tax law, income generated by businesses – sole proprietorships, limited liability companies, S-corporations, and partnerships – that is not paid at the business level ‘passes-through’ to individuals and is captured as taxable income of the business owners. This ‘pass-through’ business income is taxed at the individual level. The 100-word description does not alert signers that this ‘pass-through’ ‘business’ income would be subject to the ‘surcharge’ if it was part of an individual or married couple’s taxable income…”

Adding insult to injury, a similar Invest in Education initiative was bumped off the ballot in 2018 for similar reasons. The Arizona Supreme Court suggested acceptable initiative language to the backers of Invest in Education, but they deliberately chose not to use it.

“Arizona is not a low tax state. Its top income tax rate is already too high – just a tad below Massachusetts’. And certainly above the nine states that do not tax wage income, such as Texas, Florida, Tennessee, and Wyoming,” said Grover Norquist, president of Americans for Tax Reform. “Arizonans know this. An effort to phase down the state income tax to zero over time was narrowly defeated in the Arizona Senate just last year.”

Tragically, unclear tax initiatives are not uncommon. For example, in Arkansas, a roughly 9% permanent sales tax hike will be on ballot this November under the title “Continuing a One-Half Percent (0.5%) Sales and Use Tax for State Highways and Bridges; County Roads, Bridges and Other Surface Transportation; and City Streets, Bridges, and Other Surface Transportation After the Retirement of the Bonds Authorized in Arkansas Constitution, Amendment 91.”

Coury’s ruling shines a spotlight on a major problem that happens throughout the country. Too many tax hike measures are intentionally vague or unclear in hopes of confusing or tricking voters into supporting them.

Backers of the Invest in Education initiative have filed a notice of appeal, but given the Arizona Supreme Court’s opinion in 2018, Coury’s ruling is unlikely to be overturned.  

Photo Credit: Tuxyso

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States Are Removing Barriers to Earning A Living

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Posted by Margaret Mire on Tuesday, June 23rd, 2020, 5:22 PM PERMALINK

In all states, onerous occupational licensure laws keep Americans from their right to earn a living.

These barriers to work – which include, but are not limited to, excessive training and expensive fees – are often put in place by the politically connected as a way to protect themselves from competition. 

“Licensing laws now guard entry into hundreds of occupations, including jobs that offer upward mobility to those of modest means,” writes the authors of the second edition of License to Work, an Institute for Justice report that “examines both the scope and the specific burdens of occupational licensing” affecting 102 lower-income occupations. On average, one of these licenses requires $267 in fees, nearly a year of education and experience, and one exam.

To put the consequences of these protectionist policies in perspective, estimates show that occupational licensure laws may result in as many as 2.85 million fewer jobs nationwide and could cost consumers as much as $203 billion a year.

Fortunately, more and more lawmakers are recognizing the serious harm that licensing laws inflict on job seekers and are working to remove these barriers. 

Iowa Becomes One of Seven States to Pass A Universal License Recognition Law

Last week, the Iowa legislature sent Representative Shannon Lundgren’s (R) House File 2627 to Governor Kim Reynolds (R), making Iowa the seventh state to pass a universal license recognition bill. Once implemented, HF 2627 will allow new Iowans to use the training and skills they already have without additional red tape. 

Iowa’s bill also waives initial licensing fees for any first-time applicants from families that earn less than 200 percent of the federal poverty level and applies criminal justice reforms to the licensure process, creating a uniform standard of review for those who have their licensed denied based on conviction history. These important provisions will make it easier for low-income households and the formerly incarcerated to get jobs and provide for their families. 

“We all know heavy regulations serve as a red tape tax that impacts Iowa’s working class,” said Chris Ingstad, president of Iowans for Tax Relief. “Occupational licensing laws make it more difficult and more expensive for Iowans to earn a living and fill high-demand jobs. The changes passed by the legislature in House File 2627 put Iowans ahead of the special interests.”

Arizona was the first state to allow for universal license recognition. “Arizona’s universal recognition law may be less than a year old, but early data shows that it is already having a tremendous effect,” explains Heather Curry, Director of Strategic Engagement at the Goldwater Institute. “Since universal recognition went into effect in Arizona in September of 2019, over 1100 individuals have applied for and been granted a license to work in fields ranging from cosmetology to engineering.” 

Montana, Pennsylvania, Utah, and Idaho have also enacted a version of universal license recognition, and earlier this year, the Missouri legislature sent Representative Derek Grier’s (R) House Bill 2046 to Governor Mike Parson (R), who is expected to sign it into law.

Louisiana And Mississippi Pass Licensure Recognition for Military Families

Louisiana and Mississippi recently became one of a handful of states that have passed some form of licensure recognition for military families. 

Earlier this month, Governor John Bel Edwards (D) enacted Representative Chuck Owen’s (R) House Bill 613, which establishes a more simple and efficient process for military spouses and dependents who are licensed in another state to become licensed in Louisiana. 

“For far too long, Louisiana’s government has placed countless unnecessary barriers on those who simply want access to jobs and opportunity to support their families. Now, thanks to Representative Chuck Owen’s leadership and Governor Edwards’ signature, this needless burden has been lifted from our military families, so we can Get Louisiana Working,” said Daniel Erspamer, CEO of the Pelican Institute for Public Policy. 

Similarly, last week, the Mississippi legislature sent Senator Chuck Younger’s (R) Senate Bill 2117 to Governor Tate Reeves (R), who is expected to sign it into law. Once implemented, Mississippi will also allow military spouses and dependents to obtain a Mississippi license based on the education and training that they have already completed in other states. 

“State licensing restrictions hit military families hard because they don’t have a choice as to when and where they move,” said Dr. Jameson Taylor, vice president for policy at the Mississippi Center for Public Policy. “This is a pro-family, pro-woman, pro-military bill, and I am very proud to have worked with ATR and the U.S. Department of Defense to help pass this outstanding reform. I am also very proud of our bill sponsors, Rep. Steve Hopkins and Sen. Chuck Younger. They selflessly dedicated themselves to getting this bill just right for the military families of our state. Our chairmen Rep. Bubba Carpenter and Sen. Mike Seymour also exercised incredible leadership in prioritizing this bill and putting Mississippi on the map for military families.”

These reforms in Louisiana and Mississippi, which are very helpful to military families, who are particularly vulnerable to the consequences of onerous licensing requirements, are also a great step in the direction of granting licensure recognition for all workers.

“The movement building behind universal recognition of occupational licenses highlights the importance of federalism—50 state competing to provide the best government at the lowest cost,” said Grover Norquist, president of Americans for Tax Reform. “Destructive and stupid old laws are most likely to be repealed when surrounded by examples of better (or no) laws. Good laws drive out bad laws.”

Photo Credit: Tony McCutchan


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