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Wait
a minute! We are talking about reforming Virginia’s antiquated tax system and I mean really,
actually debating the pros and cons of revising Virginia’s tax structure. The need has been there for
years, but it was more convenient to sweep things
under the carpet rather than talk about them. Now
it’s actually a focus, and if those of us elected
to make decisions in Richmond
on behalf of our neighbors do our job, then we can
make significant progress this session.
First,
let me say that while I certainly do not agree with
Gov. Mark R. Warner on all major points of his tax
plan, I applaud him for working in good faith with
the legislature in pursuit of meaningful reform. And
I respect the fact that he has worked diligently to
bring spending in line with current revenues. Quite
frankly, some who espouse conservative viewpoints
contributed, in practice, to significant increases
in state spending prior to Gov. Warner’s term of
office. But now, rather than pointing fingers of
blame, we have the opportunity to enact changes that
ensure that Virginia remains a state where we
provide for all of our citizens, rich and poor,
young and old, gifted and challenged, 8th
generation and newcomer.
Reform
should, in my opinion, focus on changes that make
the system as fair as we can make it for individual
taxpayers and the various counties, cities and towns
throughout the state. Reform should focus on making
the system as simple as we can make it, although
sometimes simplicity must be sacrificed to achieve
fairness. Reform should make the system contemporary
and predictable. Finally, reform should address the
issues involving adequacy of revenue and
distribution of that revenue.
We
began the serious movement to tax reform with a
citizen commission that submitted a report in 2001.
This commission worked on a revenue-neutral plan
that attempted to address disparities in funding and
inequities in the system. Then a legislative
commission, of which I was a part, worked for two
years and submitted a report last winter. The work
of these two groups serves as the basis for a plan
advanced by the Commission that I currently co-chair
with Del. Harry Parrish, R-Manassas, and that Gov.
Warner has drawn from for his own plan.
The
governor’s plan and the
plan that Del. Parrish and I expect to
introduce are not identical. But there is a
significant amount of agreement, and I believe a
consensus can be reached without compromising the
goals of either party.
In
general, I believe that equity can more closely be
achieved by putting more emphasis on personal income
tax and sales tax and reducing the pressure on local
property taxes.
In
a nutshell, on personal income tax we need to
increase personal exemptions, increase standard
deductions, change the tax brackets to make the
system slightly progressive as it was originally,
and means test the age deduction. On sales tax we
need to extend the tax to retail sales on the
internet as a fairness issue, take the tax off food,
and increase the rate if necessary to balance the
budget. We should not extend the sales tax to
services. On the tax-cut side, we need to repeal the
estate tax and finish repealing the car tax and more
adequately fund local services to reduce pressure on
real estate taxes and fees. On the tax-increase
side, we are looking at a modest increase in the
cigarette tax and the gasoline tax.
Perhaps
I
have been guilty of focusing too much attention on
potential shortcomings of the governor’s plan as
judged by the priorities of conservative
Republicans. But you know what: We will work that
out in the legislative process. Sen. John Chichester,
R-Stafford, chairman of the senate finance
committee, and Majority Leader Walter Stosch,
R-Henrico, will have a significant hand in directing
a positive outcome on the senate side, as will Del.
Parrish, chairman of the finance committee, and
Speaker William Howell, R-Stafford, on the House
side.
We
can build a consensus as long as we conduct the
debate in good faith with broad participation from
Virginians of all walks of life. We will fail if we
rely on partisan rhetoric and allow extremist
anti-government groups based outside of Virginia, such as
Americans for Tax Reform and the Club for Growth, to
dictate an acceptable outcome. Let’s make Virginia
a leader
again in advancing principles of good government.
--
December 15, 2003
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