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Subject: New Tax Initiatives Go in Reverse;Instead of Battling Levies, Voters in 20
Date: Mon, 2 Nov 92 04:35:15 EST
Message-ID: <21.1992Nov2.043515@AmeriCast.com>

New Tax Initiatives Go in Reverse;Instead of Battling Levies,
Voters in 20 States to Consider Boosts<By William
Claiborne=Washington Post Staff Writer= The tax referendum ini-
tiative, once almost exclusively the weapon of anti-tax groups,
is being put to use this year in many states by new taxpayer or-
ganizations demanding increased taxes.

Of the nearly 50 tax questions on 20 state ballots next week,
about half would impose new taxes, increase existing taxes or
limit spending.

They are proposed by organizations that believe cash-strapped
state governments need more money to maintain services while
adhering to constitutional requirements for balanced budgets.

And while experts say such tax-increase measures rarely are ap-
proved, the questions represent a sharp departure from the wave
of anti-tax measures that were put on the ballot after
California's controversial anti-tax Proposition 13 triggered a
nationwide tax revolt 14 years ago.

The new measures range from a modest one-fifth-of-a-cent tax on
every 50,000 gallons of toxic waste or oil imported or manufac-
tured in Massachusetts, to a sweeping initiative in California
that would raise up to $2.1 billion annually in the largest pack-
age of tax increases in the state's history.

While Proposition 13 sought to limit taxes and rein in free-
spending state agencies, Proposition 167 on the ballot Tuesday
would increase taxes on businesses and wealthy individuals so
much, its opponents claim, that California would lose 100,000
jobs as companies leave the state.

The Massachusetts ballot will have a proposition to compel pub-
licly traded corporations, banks and insurance companies to dis-
close how much they pay in taxes.

In other states, there are proposed new or increased taxes on to-
bacco, bingo revenue, hospital and nursing home fees, prescrip-
tion drugs, government leaseholds, and, in a growing number of
states, across-the-board valued-added levies on purchases of
goods.

A citizens group in South Dakota put on the ballot a proposition
to create a graduated income tax, although the same measure would
repeal an existing sales tax on food, clothing and utilities.

In Colorado, a "Children First" initiative sponsored by Gov. Roy
Romer (D) and supported by several powerful citizens groups,
would increase the sales tax from 3 percent to 4 percent, raising
$330 million in revenue for schools.

"People who are concerned about their state's fiscal condition
now are getting the courage of their convictions and are going to
the ballot. They realize the ballot can be used not only to slash
taxes, but for fair and adequate taxes and for progressive pur-
poses," said Michael P.  Ettinger, state tax policy director of
the Washington-based Citizens for Tax Justice.

The tax justice group said it was encouraged by recent tax-
dominated primary elections in Connecticut, where a predicted
voter backlash against last year's adoption of a state income tax
failed to materialize.

In both Republican and Democratic legislative primaries, income
tax supporters on Sept. 15 defeated opponents in 14 of 17 races
they contested.

In New Hampshire, a state that traditionally has been against tax
reform, Deborah Arneson easily defeated her opponents in the
state's Democratic gubernatorial primary on Sept. 8 with a cam-
paign for a state income tax.

Referring to Tuesday's tax referenda, Scott Mackey, senior fiscal
analyst for the National Conference of State Legislatures, said,
"People who want higher taxes to pay for services are taking a
page out of the book of the anti-tax people. They're trying to
beat them at their own game, and they have the money to get their
thing on the ballot."

However, some state tax experts said the flurry of tax increase
referenda is simply a variation of a recent trend by voters to
assert directly their will on tax issues rather than giving
legislators exclusive tax powers, and they predicted that most of
the measures will never become law.

Growing public concern with government debt generally, these
analysts said, may be responsible for the increasing number of
pro-tax questions on the ballot this year, but it does not neces-
sarily mean the tax initiatives will be any more successful than
tax measures of any kind have been in the past.

"Statistically, the record would probably show that when you put
tax issues on the ballot, they tend to fare more poorly than if
they go to the legislatures. People seem to like the status quo
when it comes to taxing, and often the question is written in
such complex language that it is difficult to know what you're
voting on," said Marsha Howard, deputy executive-director of the
National Association of State Budget Officers.  Mackey said he
expects only two of the tax-increase propositions to win Tuesday
- the sales tax increase in Colorado and a 25-cent-per-pack hike
in Massachusetts' excise tax on cigarettes.

Nonetheless, state budget analysts said, the level of taxpayer
concern over fiscal disarray in statehouses is also reflected in
the growing number of ballot propositions that would limit or
reduce spending.

One tax limitation proposition, in Colorado, would restrict state
and local spending to a level that reflects the rate of inflation
plus population growth unless voters otherwise approve or an em-
ergency situation exists.

A California proposition would allow the governor to declare a
fiscal emergency and reduce general spending without legislative
approval, while Rhode Island voters will decide on a proposal
which would prohibit the state government from appropriating more
than 98 percent of available financial resources in any fiscal
year, with the rest to be placed in a "rainy day fund" and used
for debt repayment or capital projects after the fund reaches 3
percent of budget.02:19 11-02C9999-----

Copyright 1992, The Washington Post.  This story is from the
Washington Post's Capitol Edition On-Line and is not to be ar-
chived or redistributed.

For more information, send-email to American Cybercasting Cor-
poration (usa@AmeriCast.COM)