Re: Sales Tax Exemptions

["John Danahy" <JDANAHY@turbonet.com>]

In K-12 education, many districts (including Moscow) increased local
property taxes in response to the tax cut.  If I am going to be expected to
pay more in income or sales taxes, will the property taxes be rolled back
accordingly?

John Danahy
jdanahy@turbonet.com
----- Original Message -----
From: "Tom Trail" <ttrail@moscow.com>
To: <vision2020@moscow.com>
Sent: Thursday, August 01, 2002 7:22 AM
Subject: Sales Tax Exemptions


> Visionaires:    This is a followup to my e mail yesterday concerning sales
> tax exemptions.  Much of
> the overall issue is ensuring that the State has enough revenue to
> adequately fund K-12, Higher
> Education and other state services.
>
> The state currently grants about $300,000,000 in sales tax
exemptions/year.
> There is some
> discussion that some of these exemptions should be eliminate and this
would
> increase those
> lost funds to the state revenue stream.   I'm working on legislation that
> would review all
> sales exemptions over a 5 year period.  Remember that a sales tax
exemption
> is a privilege granted
> by the state and not a right as many organizations appear to feel after
> having the exemption over
> time.   Organizations should be able to show benefit to the state and
> justify further extension
> of their exemptions.   This review approach is consistent with
> accountabilty and responsibility
> in evaluating each exemption.
>
> There is also discussion concerning the possible taxation of services.
> We've shifted from
> from a taxation on goods to a service economy since the sales tax was
> implem ented in 1965.
> The State Tax Commission estimates there is about $660 million worth of
> services that could
> be taxed in the state.   Several unsuccessful attempts have been made in
> the past to place
> a tax on selected services.   One idea is to place a sales tax on certain
> services and reduce the
> sales tax.   This would generate an additional $100,000,000.
>
> There are still several other initiatives that I feel are still viable in
> raising funds.
>
>  1) employ more tax auditors to go after the estimated 40,000 non-filers
> who owe more than
>      $90,000,000 million.   each auditor will return about 7 times the
> amount of his/her salary
>      and benefits.    This is the treasure lode that we can go after
> without raising taxes.
>
>  2) place a two year moratorium on the personal income tax cut passed by
> the legislature last
>      year.   This would yield an estimated $80 million/year.   The impact
> per year on an individual
>      earning $75,000 net would be about $80 in a year.   The Dist. 5
> Legislative delegation
>      personally requested the Governor to support placing a moratorium on
> the personal tax
>      cut to support education.   The moratorium could be taken off when
the
> economy recovers.
>      There has been much criticism concerning the passage of the tax cuts
> last year.  Looking
>      back it certainly was a mistake.   I voted for the final package of
> cuts which was the lowest
>      total figure that came out of the rev and tax committee.   It is
> interesting to note that there
>      was only one legislator who voted against the tax cuts  (several
> legislators were conveniently
>      absent for the final vote)
>
> Just about all of the states are faced with similar budget problems.
I've
> received assurance from
> a number of conservatives that they realize that education has been cut to
> the bone and would
> consider a tax increase to support education.    I know the Leg. 5
> legislators will continue to
> press forward as we have in the past to try and convince decision makers
> that the level of
> support for public and Higher Education must be maintained and increased.
>
> Rep.Tom Trail/Dist. 5
>
> Dr. Tom Trail
> International Trails
> 1375 Mt. View Rd.
> Moscow, Id. 83843
> Tel:  (208) 882-6077
> Fax:  (208) 882-0896
> e mail ttrail@moscow.com
>
>