Posted on 05/10/2002 5:41:19 AM PDT by GailA
Edited on 05/07/2004 9:20:00 PM PDT by Jim Robinson. [history]
With a vote on a state income tax possible next week in the House, new details about the legislation are surfacing, including plans to impose a temporary 1% increase in the state sales tax and increases in other taxes, including the tax on a pack of cigarettes.
(Excerpt) Read more at tennessean.com ...
Income tax plan needs temporary sales tax hike, speaker says
Associated Press
NASHVILLE, Tenn. - House Speaker Jimmy Naifeh's plan to create a 4.5 percent flat income tax would require a temporary 1-cent sales tax increase to tide the state over until the new tax could be implemented.
The sales tax increase is not mentioned in the 114-page bill that moved through the House Calendar Committee Thursday morning to the House floor but leaders plan to add it. Naifeh said it would bridge the revenue gap until the income tax would be in place next Jan. 1, halfway through the state's fiscal year.
Raising the sales tax from 6 cents on the dollar to 7 cents would bring in about $60 million a month. That would mean some $420 million in new state revenue from June 1 through Dec. 31 if lawmakers approve the income tax bill this month.
The sales tax would automatically lower to 6 cents on Dec. 31, Naifeh said.
"The good thing about that is that we would not be here to renew it on Dec. 31. It's truly temporary," the speaker said.
The income tax bill, which was approved with no discussion on a voice vote of the Calendar Committee, will be held on the clerk's desk until Naifeh believes he has enough votes to pass it.
"We have it where we need it for when we feel the window of opportunity is open," he said.
That could be as early as next Wednesday, when the House has its next session, but Naifeh is having a hard time collecting the necessary 50 votes from the 99 members. He says he has well more than 42 votes but that the count fluctuates.
Naifeh and Democratic leaders are considering raising so-called "sin taxes" on beer, wine, liquor and cigarettes to help garner more support for the income tax plan and to bring in more money.
As it now stands, the plan would bring in some $1.1 billion during a full year. Gov. Don Sundquist's $9.6 billion budget proposal for the fiscal year that begins July 1 requires $1.4 billion in new revenue.
Naifeh said he is "steamed" over the lack of support for his plan in communities that have public colleges and universities.
"Something is terribly wrong. Either these people are not for education, they're not for higher education, or they want to be re-elected more than they want to help the system," Naifeh said.
He didn't name names but said it's "really distressing" that East Tennessee State University "cannot bring us a vote." He said only two legislators in Knoxville, where the University of Tennessee's largest campus is located, and two in Chattanooga, home to the UT-Chattanooga, are willing to support the plan. There's also "not the support I wish we had" in Nashville.
"I don't understand it," Naifeh said.
He challenged alumni and members of the boards that oversee the state's public colleges, universities to "get off their cans and do something."
"They ought to be on them, not daily, but hourly," Naifeh said.
University of Tennessee President-designate John Shumaker answered the challenge on Thursday.
"Since accepting the presidency of the University of Tennessee, I have repeatedly said that we want to provide Tennesseans the best university they can afford while encouraging them to afford the best," he said.
"I urge all of our alumni and friends who want the very best for UT to let their local legislators know how important support for our university system is to the future of Tennessee."
David Gregory of the Board of Regents, which oversees all public colleges and universities outside of UT, said the system "has been active in our support of tax reform.
"We're probably as disappointed as the speaker that we haven't been able to convince the people of the Regents' needs. We will take his challenge before the board when it meets Monday," Gregory said.
Tom Ballard of UT said "we have been working for several years directly and through our alumni public affairs committee to make sure that legislators understood the needs that UT has and the challenges that we face if the funding logjam is not broken."
Under Naifeh's plan, the income tax would apply to adjusted gross income as figured on federal income tax forms. It includes exemption levels of $15,000 per taxpayer - or $30,000 for a married couple - plus $1,500 per dependent.
The bill would remove all sales taxes from clothing, nonprescription drugs and food sold in grocery stores.
The bill would eliminate the 6 percent Hall Income Tax on interest and dividend income, treating that income like any other.
It would tax 50 percent of capital gains.
The bill includes a provision to cap the amount of tax revenue the state can bring in from all sources at 6 percent of the state's economy, as measured by gross personal income.
Anything above that would be rebated to taxpayers unless the overage wasn't enough to cover the cost of remittance. In that case the amount above 6 percent would go to the state's Rainy Day Fund.
Naifeh's tax plan does nothing to address the expected $480 million shortfall in the current budget year, which ends June 30. That deficit likely will have to be covered using reserve funds, which will leave the state little cushion for next year.
It would take an estimated $880 million in new revenue next year to provide again the same level of services the government provides this year.
The bill is HB2957/SB2646.
MANY of the legislators especially the pro-it ones are NOT reading their email
Tennessee General Assembly: CLICK HERE
On the left side of the page are these choices: Information, Senate, House, Joint, Bills and Other Links. These options should get you to any information you need including office numbers, phone numbers, email addresses, committee assignments, legislative bills, etc.
Toll Free calling 1-800-449-8366 + extension or call the switchboard at (615) 741-3011.
EXtention is 1 + the last 4 digits of their Nashville office. Many of these PRO-Income tax legislators are NOT reading their email. I strongly suggest using the toll free number.
5/8/02 Press Release from Republican Canidate Chuck Bates
Contact: Layne Provine 854-7119 or 359-7119
Chuck Bates, Republican candidate for Tennessee House District 83 publicly challenged incumbent Rep. Joe Kent to explain why he sat silently as a member of the House Finance Committee while it approved on a voice vote a massive additional $1.1 billion income tax burden on the people of Tennessee.
Bates noted that most press accounts showed the measure was steamrolled through without a challenge. Capitol Hill correspondent Paula Wade writing for the Memphis Commercial Appeal said on the tax vote, "The House panel had no discussion and passed the measure on a voice vote in which the "nays" seemed louder than the "ayes" but Finance Committee chairman Matt Kisber declared the measure passed."
There was no request for a recorded vote. Bates charged that Rep. Joe Kent, with 24 years of seniority, sat like a "potted plant" when he could have simply asked for a recorded vote and forced the public’s business into the open and cause the income tax measure to be defeated or withdrawn. Bates said, "Only when it made no difference and did not count, did Kent quietly ask the clerk to record him as voting no. This kind of stealth like politics is why Mr. Kent, along with many other incumbents, are in trouble with the voters."
Bates charged, "Rep. Joe Kent’s "potted plant" like actions will ultimately cost a person making $35,000 per year an additional $75 per month in state income taxes if the measure ultimately passes the full House and Senate."
My boss believes that they will go so far as to try to keep the people one or two blocks away from the building. If they want to start a revolution, then that is exactly how to do it as the people simple will not stand for this type of tyranny.
You notice NOTHING was said originally about the need for the OTHER TWO tax hikes!
SB2646FISCALNOTE Summary of Bill:
IMPOSES sales tax on public pay telephone services, television or RADIO programs which are broadcast over the air waves for public consumption private line, service, or ATM service, wire transfer or other services provided by any coroporation definded as a Financial Institution. Currently by definition, these items are expempt from sales tax.
Imposes full sales tax on electricity and liquefied gas certain medical items and needs air craft parts and a long list of items. Gets Vets, doctors, dentist, eye docs you name it it gets it.
The only thing I am thankful for is that in MO we have to vote on proposed sales tax increases. We had a $.06/gallon tax on gas for highway work which NEVER HAPPENED. Don't *even* get me started on "personal property taxes".
Good luck to y'all! This socialist creep never ends...
The crowd applauded when Naifeh said he was “very hopeful” the General Assembly could pass tax reform “in the month of May.” The Nashville City Paper
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. (The Kingsport Times)
''I assure you that we, the Tennessee General Assembly, as long as I am there, won't be spending wildly because we're not going to have enough revenue to be spending wildly. We are going to have to be very prudent in what we do and what we spend if we are able to pass this bill. Naifeh The Tennessean 4/30/02
HOBBS spending spree
ECONOMIST WITH POSTIVE VIEW as opposed to pet in house wm fox's we need MORE money view CLICK HERE According to the Tennessee Department of Revenue, state tax revenues have increased by 26 percent over the past five years and 82 percent over the past 10 years. Although tax revenues increased by only 1 percent in the past fiscal year, they increased by more than 8 percent in the preceding year. How many Tennesseans saw their personal incomes increase by a like amount over the past two years? An evaluation of state spending is equally revealing. Expenditures this fiscal year are more than 6 percent higher than last year's, and are projected to rise by another 6.5 percent next year. THE LARGEST increase is in what is referred to as "miscellaneous" appropriations. This category increased 186 percent this fiscal year, and is projected to increase by another 186 percent during the next fiscal year. This spending is never documented in detail. Again, how many Tennessee families have been able to afford almost a 13 percent increase in their spending over the past two years? It would seem just as reasonable to suggest that the fiscal problems are the product of a state government that has paid too little attention to the spending side of the budget.
Let's be careful not to zero in on Wednesday. It seems to me that Jimmy Naifeh is pulling a poker bluff. Just when everyone settles down in the meantime, waiting to spring into action on Wednesday, he could pull a trick and call a vote with no notice on Tuesday. We need to be ready at all times, like minutemen (and women, of course).
He said only two legislators in Knoxville, where the University of Tennessee's largest campus is located, and two in Chattanooga, home to the UT-Chattanooga, are willing to support the plan. There's also "not the support I wish we had" in Nashville
Kind of hard Jimmy to go to the the well after UT just announced the compensation package for the new prez of UT at $715,000!!! His base salary of $365,000 is over $100,000 higher than the last UT president. No where to cut huh Jimmy?!!! They know there isn't enough income to pay for their spending now but the bums won't stop spendiing!!!!
They are truly insane, "Doing the same thing over and over but expecting a different outcome." Keep blowing your horns just like they did at Jericho. Those gray limestone walls will could just come tumbling down.
Not to worry...we're all keeping a watchful eye on this son-of-a-bitch.
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