Don Miller (D) for State Representative, District 75
-- Help eliminate the tax fairness gap so that low and middle income taxpayers don't pay, in all forms of state and local taxes, a tax rate that is almost double the tax rate paid by Utah households with incomes averaging $826,000.
-- As a first step, eliminate the regressive 2.75 percent state sales tax on unprepared food which falls hardest on low and middle income families, and
-- Allow school districts to levy new home impact fees to help pay for schools instead of using property taxes which also fall hardest on retired and middle income families.
-- Repeal the regressive flat tax and replace the existing dual tax system with a progressive income tax similar to the Jones-Mascaro plan.
-- Impose a moratorium on tax breaks for favored Wasatch Front businesses, and
-- Vote to stop the erosion of the tax base supporting public schools in Utah so our highest priority -- educational quality and attainment also won't continue to be reduced and eroded.
In addition, vote for smart planning to preserve the quality of life that brought us here in the first place. Also vote for a candidate who isn't beholden to powerful Wasatch Front interests.
Don Miller is a native Utahn with Utah values; also a husband and grandfather. Attended West High School in SLC, and earned BS in accounting From the University of Utah. Formerly an issue area manager with the US GAO, the congressional watchdog agency.
Vote For Don Miller To Get Education Reform
-- Most middle and high schools should operate year round to save tax money and to benefit students academically.
-- Impose a moratorium on creating additional charter schools. Too many charter schools drain away public school funds to create segregated, quasi private schools.
-- Education reform is needed to ensure that more then 16 percent of Washington County high school graduates go on to earn a college degree. Quick action should be taken to allow Dixie State College to realize its full potential by becoming a 4 year baccalaureate granting institution.
-- Washington County high schools should be allocated special funds by the Legislature and a mandate to take advantage of a breakthrough reform program on "how to make it to college" called AVID (Advancement Via Individual Determination). According to advocates, of the students who participated in AVID in 2004, enrollment in 4 years colleges was achieved by 75 percent of the AVID students.
-- Utah should also fund optional full-day kindergarten in schools with high populations of high risk students.
The Latest "dual- tax" Regressive Tax Cut
And Reductions In Educational Attainment
Many informed observers ask does the latest "dual-tax" cut system passed by the Legislature indicate that the majority party is out of touch with Utahns and tax fairness? A clear majority (70 percent in one poll) said they wanted the money to be spent on improving public schools.
Unfortunately, the dual-tax system just enacted will further erode an already eroded school tax base by another $780 million over the next ten years. Ninety five percent of Utah's households will save from $24 to $60 next year, about enough to go out for a meal and perhaps a movie, or fill up their gas tank.
In contrast, the favored 5 percent of the highest income households who will primarily benefit from the regressive flat- tax schedule will save about 12 times as much or about $720. Over 10 years the school taxes lost to this small elite group will total $360 million.
The dollars from the dual-tax cut could have been used to hire more than 1,250 new teachers, reduce class sizes statewide in kindergarten through the third grade by 4 students per class, or purchase modern textbooks and computers for Utah's school children. The ratio of students to computers is the worst in the nation, so Utah was recently graded "F" for student access to technology.
Education -- the greatest and fairest bang for the buck
Spending tax dollars on quality schools is a wise investment because it provides the greatest possible bang for the buck for the overall public good. Quality schools contribute to the quality of life of virtually all citizens and are a great boost to businesses who need educated workers. Quality education produces better citizens and results in less poverty and crime.
The sad fact is that about half of Utah's non-Asian minority students don't graduate from high school and thus many are destined to live in poverty. White students are four times more likely to attend college. Despite these disparities, in 2006 the majority in the Legislature refused to fund optional full-day kindergartens in schools with high populations of high risk students.
Utah's tax system already very regressive
After a decade of tax cuts which eroded the school tax base and even before the latest dual- tax cut favoring Utah's highest income households:
-- Utah's tax system was already very regressive, increasing the financial gap between the haves and the have nots. In 2002 middle income Utahns making between $27,000 and $67,000 paid more than 10 percent of their income in state and local taxes, while those earning an average of $826,000 paid only 5.5 percent. This is the direct opposite of a fair tax system. The regressive tax burden for the poorest Utahns making less than $16,000 totaled 11.4 percent of their income.
Flat income taxes like the one just passed in Utah contribute to the tax fairness gap because they ignore the ability-to-pay principle and don't include progressive rate increases with certain increases in taxable income. This unfairly shifts a greater portion of the tax burden to low and middle income taxpayers. This known basic fairness flaw is why at the national level the GOP hasn't bothered to propose a flat income tax even though they firmly control Congress and the White House and this bad idea has been pushed by Steve Forbes and others for years.
Thus, there is a clear need for reform to eliminate Utah's tax fairness gap. By 2006 the average income of the top one percent in Utah had reportedly increased to $957,000.
In a recent guest column in a Salt Lake City newspaper shortly after the dual- tax cut was passed, the president and CEO of Zions Bank, also pointed out the fairness gap in Utah's regressive tax system. He called for partial reform to reduce the tax fairness gap through a Utah version of the earned income tax credit (EITC) to provide tax relief to about 170,000 Utahn's making less than $38,000 a year. This reform, which he said could boost local economies throughout the state, was advocated in 2004 by Utah Issues Center for Poverty Research and Action.
A state EITC could help achieve tax fairness for low income families, but it still leaves a tax fairness gap between the low tax rate paid by the top one percent compared to the higher rate paid by middle income households. This is a major part of the tax fairness gap that the majority party also won't address as shown by the latest dual-tax system which also provides the largest tax cuts to the highest income households.
A state EITC could also serve as a mechanism to help many more eligible Utahns receive federal tax benefits that they are entitled to under the federal EITC, but are not now claiming. Estimates indicate that each year Utahns eligible for the federal EITC fail to claim $80 million in federal tax benefits. Even if a state EITC isn't adopted, a formal taxpayer notification system should be quickly provided by the state to increase utilization of the federal EITC by eligible Utahns. As the president and CEO of Zions Bank noted, this simple tax reform would bring significant economic benefits to Utah's working families.
Meanwhile:
Utah's average income has declined from near the national average to 84 percent of the national average. In addition, more than a quarter of all Utah families with at least one working adult are considered low income and struggle to make ends meet. As the president and CEO of Zions Bank noted, providing tax relief to strengthen the financial stability of working families should be a state priority.
The number of Utahn's without medical insurance from 2004 to 2005 grew by at least 40,000 to 293,000, or 12 percent of the population, according to conservative Utah Health Department estimates. However, the US Census reports the number of uninsured Utahns to be higher by 127,000 at 420,000, or about 17 percent of the population. Those most likely to go without health insurance are those with household incomes at or below 200 percent of the poverty level. In Utah, 91 percent of an estimated 88,500 uninsured children have at least one working parent.
And sadly, the number of Utah children living in poverty increased by 30 percent in the past few years primarily due to low wages.
Erosion of Educational Attainment
Statewide the percentage of young Utahns going on to college has declined from 53 percent to 39 percent. While the rest of the country was improving, Utah experienced the steepest decline in college degree attainment in the nation. About half of the students who enter college don't finish a bachelors or an associates degree in 6 years.
The bachelor degree attainment rate in Washington County is only 16 percent. Today Dixie State College operates on a state allocation that is only two-thirds of similar peer institutions in Utah.
Since 2000 Washington County doubled its share of state sales tax revenue while statewide sales tax revenues increased by only 11 percent, and the percentage of total state income tax receipts from the county increased by one-third. Thus, the state is benefiting from the booming economy of Washington County but neglecting educational opportunities here, according to the president of Dixie State College.
Moreover:
-- In the past 7 years state support for higher education has declined by 18 percent.
-- The 2006 ACT scores indicated that significant numbers of Utah students were still below college readiness benchmark scores. Seventy four percent met the English benchmark and 60 percent met the reading benchmark, but only 43 percent met the math benchmark and a mere 31 percent met the science benchmark.
All of this indicates that the majority party's tax policies are eroding educational attainment in Utah, and aren't improving the lot of the middle class and low income workers. Educational attainment in Washington County is especially troubling because it is 75 percent below the national average.
Business Tax Erosion
According to tax fairness experts, over the past 15 years, business tax collections as a percent of Utah GSP have declined by 40 percent. This erodes the school tax base and shifts more of the tax burden to low and middle income families. In addition, Fortune 500 companies nationwide didn't include two thirds of their pretax profits in 2003 state returns, cutting their state taxes from a nationwide average of 7 percent to about 2 percent.
There is a continuing effort by the majority party to further reduce business taxes. For example, in 2005 Utah lawmakers adopted the "double the sales tax factor" for profit apportioning to reduce corporate taxes for information technology, biotech, mining and manufacturing firms -- firms that produce in Utah but export products out of state. This tax cut eroded the school tax base over 10 years by $350 million. Utah retained the "equally weighted factor formula" so corporations could use whichever formula that would provide them with the lowest taxes. Now lawmakers are leaning towards a "single sales factor" to further reduce business taxes and the school tax base.
Tax rebates and other tax expenditure incentives are routinely provided to favored firms under Utah's economic development program. The agency providing these tax breaks tried to withhold information from the public on which firms were receiving these tax gifts. Hence, the Governor recently ordered the information to be made public. In August $8 million was given to a yogurt manufacturer who was expanding its facility, not thinking of leaving Utah and isn't a high wage paying business.
In 2006, taxes for favored corporations were cut by $20 million, including a $3 million decrease in gross receipts taxes on certain corporations not required to pay corporate franchise taxes or income taxes, and sales and use taxes for the telecommunications industry were cut by $7 million.
Sales tax exemptions have been provided over the years to numerous entities so the 2006 Legislative Summary reports $183 million in this category. This category includes $28 million for sales of natural gas, electricity, coal, and fuel oil for industrial use. Yet other firms and households routinely pay such taxes -- in St. George households pay a 3.5 percent state sales tax on natural gas as well as a 6 percent tax to the City of St. George.
Utah's School Support Ranking At New Low
Not surprisingly, the tax base supporting public schools during the past 10 years has been eroded by tax changes so that Utah now ranks 36 nationally in current school funding per $1,000 of personal income. Ten years ago Utah ranked seventh highest in this spending category.
So Utah has the largest class sizes in the nation, and ranks 51 in per pupil expenditures. Recent Utah polling data showed that 87 percent of those with children in public schools, said schools are overcrowded. Utah spending is more than $1,000 per pupil below Idaho. Only seven states have lower teacher starting salaries.
As noted above, the dual- tax cuts just enacted will further erode the school tax base by $780 million over the next ten years.
Erosion of the tax base is occurring when the school population is growing -- a 30 percent increase or 150,000 new students are expected in the next 10 years. Educational attainment in Utah is declining.
Tax Reforms -- State sales tax on food and school impact fees
Instead of the dual-tax cut, eliminating the remaining 2.75 percent state portion of the sales tax on unprepared food would have been real tax reform. Income taxes in Utah are constitutionally reserved to support public schools. Thus, sales tax reform won't further erode the school tax base and would provide needed tax relief to low, moderate and middle income families, and would be a good first step to reducing Utah's tax fairness gap.
School Impact Fees
Additionally, new-home fees should help pay for schools. Tax reform should include Utah school districts being allowed to levy impact fees on new construction to fund new growth instead of using regressive property tax increases which fall hardest on the retired and the middle class. This impact fee funding method was banned by the Legislature in 1995. This unfair decision shifts much of the tax burden for new growth to long term residents.
Tax Policy Transparency Needed
The need for tax transparency reform is evident from the Utah Tax Commission's action this year to chastise its chief economist for revealing too much information to the public about a recent tax cut proposal.
Additionally, in 2006 the Institute on Taxation and Economic Policy pointed out that Utah needs to adopt several tax policy transparency reforms. Utah doesn't routinely publish tax incidence analysis to show the impact of taxes on the different income levels. Additionally, Utah doesn't have tax expenditure reporting to show expenditure programs hidden in the tax code as breaks for favored businesses and an assessment of their usefulness. Utah also doesn't obtain basic information on taxes paid or not paid by large corporations. Utahns would obviously benefit from these recommended tax policy transparency reforms.
Summary
In summary, while regressive tax changes are being pushed by the majority party and the school tax base is being eroded, Utah's average income has declined from near the national average to 84 percent. In contrast, the average income of the top one percent has increased from an average of $826,000 to $957,000. Also the number of Utahn's without medical insurance from 2004 to 2005 grew by at least 40,000 so between 12 percent and 17 percent of the population went without health insurance including 88,500 children. The number of children living in poverty increased by 30 percent.
Also Utah's educational attainment is declining dramatically, and educational attainment in Washington County is 75 percent below the national average.
Does the majority party in Utah resemble politicians who, in the words of the Spectrum newspaper, "have become too comfortable, have been left unchecked for too long and have lost sight of the needs of their middle class and low income constitutes?"
Tax Reform
An equitable tax system adhering to the ability-to-pay principle is the foundation of the democratic process. That is why modern, enlightened nations adopt progressive tax laws. Utah's tax system is regressive and should be reformed. As pointed out by the president and CEO of Zions Bank, tax policy in Utah should be reformed to help working families. Reforms should include eliminating the tax fairness gap so that low and middle income taxpayers don't pay double the tax rate paid by households with incomes averaging $826,000.
The newly created regressive flat tax schedule should be scrapped because it adds to the tax fairness gap and isn't tax reform.
Replace the existing dual tax system with a progressive income tax similar to the Jones-Mascaro plan.
On the other hand, a formal taxpayer notification system should be quickly developed by the state to help eligible Utahns to claim the $80 million in federal EITC tax benefits they are entitled to, but are not now claiming.
Utah lawmakers should also place a moratorium on further tax cuts for businesses, and carry out a comprehensive and bipartisan review of existing business tax breaks, including an objective assessment of their fairness and usefulness as recommended by the Institute for Taxation and Economic Reform.
Education Reform
Education has been called the cornerstone of democracy and is crucial to economic growth and high paying jobs. On the other hand, schools must do all they can do to use limited tax money with extreme care to maintain public support for quality schools. In this regard most schools should operate year round to save tax money and benefit students academically.
A moratorium on creating additional charter schools should be imposed. Utah's quasi private charter schools are unlikely to provide significant academic advantages compared to public schools and too often are merely a segregated drain on funds needed for public schools.
A significant upgrading of Washington County's educational resources would help ensure that more than 16 percent of the county's high school graduates go on to earn a college degree.
In this regard, quick action should be taken to allow Dixie State College to realize it full potential by becoming a four year baccalaureate granting institution.
Washington County high schools should have a mandate to take advantage of the "how to make it to college" program AVID (Advancement Via Individual Determination) discussed at the beginning of this platform paper. AVID is now in more than 2,600 schools nationwide. AVID program initial costs per school at seven middle and high schools in the Granite School District were about $20,000. Staff to teach AVID concepts is an additional cost.
A vote for Don Miller is a vote for tax and school reform
-- As a first step, eliminate the regressive 2.75 percent state sales tax on unprepared food which falls hardest on low and middle income families, and
-- Allow school districts to levy new home impact fees to help pay for schools instead of using property taxes which also fall hardest on retired and middle income families.
-- Repeal the regressive flat tax and replace the existing dual tax system with a progressive income tax similar to the Jones-Mascaro plan.
-- Impose a moratorium on tax breaks for favored Wasatch Front businesses, and
-- Vote to stop the erosion of the tax base supporting public schools in Utah so our highest priority -- educational quality and attainment also won't continue to be reduced and eroded.
In addition, vote for smart planning to preserve the quality of life that brought us here in the first place. Also vote for a candidate who isn't beholden to powerful Wasatch Front interests.
Don Miller is a native Utahn with Utah values; also a husband and grandfather. Attended West High School in SLC, and earned BS in accounting From the University of Utah. Formerly an issue area manager with the US GAO, the congressional watchdog agency.
Vote For Don Miller To Get Education Reform
-- Most middle and high schools should operate year round to save tax money and to benefit students academically.
-- Impose a moratorium on creating additional charter schools. Too many charter schools drain away public school funds to create segregated, quasi private schools.
-- Education reform is needed to ensure that more then 16 percent of Washington County high school graduates go on to earn a college degree. Quick action should be taken to allow Dixie State College to realize its full potential by becoming a 4 year baccalaureate granting institution.
-- Washington County high schools should be allocated special funds by the Legislature and a mandate to take advantage of a breakthrough reform program on "how to make it to college" called AVID (Advancement Via Individual Determination). According to advocates, of the students who participated in AVID in 2004, enrollment in 4 years colleges was achieved by 75 percent of the AVID students.
-- Utah should also fund optional full-day kindergarten in schools with high populations of high risk students.
The Latest "dual- tax" Regressive Tax Cut
And Reductions In Educational Attainment
Many informed observers ask does the latest "dual-tax" cut system passed by the Legislature indicate that the majority party is out of touch with Utahns and tax fairness? A clear majority (70 percent in one poll) said they wanted the money to be spent on improving public schools.
Unfortunately, the dual-tax system just enacted will further erode an already eroded school tax base by another $780 million over the next ten years. Ninety five percent of Utah's households will save from $24 to $60 next year, about enough to go out for a meal and perhaps a movie, or fill up their gas tank.
In contrast, the favored 5 percent of the highest income households who will primarily benefit from the regressive flat- tax schedule will save about 12 times as much or about $720. Over 10 years the school taxes lost to this small elite group will total $360 million.
The dollars from the dual-tax cut could have been used to hire more than 1,250 new teachers, reduce class sizes statewide in kindergarten through the third grade by 4 students per class, or purchase modern textbooks and computers for Utah's school children. The ratio of students to computers is the worst in the nation, so Utah was recently graded "F" for student access to technology.
Education -- the greatest and fairest bang for the buck
Spending tax dollars on quality schools is a wise investment because it provides the greatest possible bang for the buck for the overall public good. Quality schools contribute to the quality of life of virtually all citizens and are a great boost to businesses who need educated workers. Quality education produces better citizens and results in less poverty and crime.
The sad fact is that about half of Utah's non-Asian minority students don't graduate from high school and thus many are destined to live in poverty. White students are four times more likely to attend college. Despite these disparities, in 2006 the majority in the Legislature refused to fund optional full-day kindergartens in schools with high populations of high risk students.
Utah's tax system already very regressive
After a decade of tax cuts which eroded the school tax base and even before the latest dual- tax cut favoring Utah's highest income households:
-- Utah's tax system was already very regressive, increasing the financial gap between the haves and the have nots. In 2002 middle income Utahns making between $27,000 and $67,000 paid more than 10 percent of their income in state and local taxes, while those earning an average of $826,000 paid only 5.5 percent. This is the direct opposite of a fair tax system. The regressive tax burden for the poorest Utahns making less than $16,000 totaled 11.4 percent of their income.
Flat income taxes like the one just passed in Utah contribute to the tax fairness gap because they ignore the ability-to-pay principle and don't include progressive rate increases with certain increases in taxable income. This unfairly shifts a greater portion of the tax burden to low and middle income taxpayers. This known basic fairness flaw is why at the national level the GOP hasn't bothered to propose a flat income tax even though they firmly control Congress and the White House and this bad idea has been pushed by Steve Forbes and others for years.
Thus, there is a clear need for reform to eliminate Utah's tax fairness gap. By 2006 the average income of the top one percent in Utah had reportedly increased to $957,000.
In a recent guest column in a Salt Lake City newspaper shortly after the dual- tax cut was passed, the president and CEO of Zions Bank, also pointed out the fairness gap in Utah's regressive tax system. He called for partial reform to reduce the tax fairness gap through a Utah version of the earned income tax credit (EITC) to provide tax relief to about 170,000 Utahn's making less than $38,000 a year. This reform, which he said could boost local economies throughout the state, was advocated in 2004 by Utah Issues Center for Poverty Research and Action.
A state EITC could help achieve tax fairness for low income families, but it still leaves a tax fairness gap between the low tax rate paid by the top one percent compared to the higher rate paid by middle income households. This is a major part of the tax fairness gap that the majority party also won't address as shown by the latest dual-tax system which also provides the largest tax cuts to the highest income households.
A state EITC could also serve as a mechanism to help many more eligible Utahns receive federal tax benefits that they are entitled to under the federal EITC, but are not now claiming. Estimates indicate that each year Utahns eligible for the federal EITC fail to claim $80 million in federal tax benefits. Even if a state EITC isn't adopted, a formal taxpayer notification system should be quickly provided by the state to increase utilization of the federal EITC by eligible Utahns. As the president and CEO of Zions Bank noted, this simple tax reform would bring significant economic benefits to Utah's working families.
Meanwhile:
Utah's average income has declined from near the national average to 84 percent of the national average. In addition, more than a quarter of all Utah families with at least one working adult are considered low income and struggle to make ends meet. As the president and CEO of Zions Bank noted, providing tax relief to strengthen the financial stability of working families should be a state priority.
The number of Utahn's without medical insurance from 2004 to 2005 grew by at least 40,000 to 293,000, or 12 percent of the population, according to conservative Utah Health Department estimates. However, the US Census reports the number of uninsured Utahns to be higher by 127,000 at 420,000, or about 17 percent of the population. Those most likely to go without health insurance are those with household incomes at or below 200 percent of the poverty level. In Utah, 91 percent of an estimated 88,500 uninsured children have at least one working parent.
And sadly, the number of Utah children living in poverty increased by 30 percent in the past few years primarily due to low wages.
Erosion of Educational Attainment
Statewide the percentage of young Utahns going on to college has declined from 53 percent to 39 percent. While the rest of the country was improving, Utah experienced the steepest decline in college degree attainment in the nation. About half of the students who enter college don't finish a bachelors or an associates degree in 6 years.
The bachelor degree attainment rate in Washington County is only 16 percent. Today Dixie State College operates on a state allocation that is only two-thirds of similar peer institutions in Utah.
Since 2000 Washington County doubled its share of state sales tax revenue while statewide sales tax revenues increased by only 11 percent, and the percentage of total state income tax receipts from the county increased by one-third. Thus, the state is benefiting from the booming economy of Washington County but neglecting educational opportunities here, according to the president of Dixie State College.
Moreover:
-- In the past 7 years state support for higher education has declined by 18 percent.
-- The 2006 ACT scores indicated that significant numbers of Utah students were still below college readiness benchmark scores. Seventy four percent met the English benchmark and 60 percent met the reading benchmark, but only 43 percent met the math benchmark and a mere 31 percent met the science benchmark.
All of this indicates that the majority party's tax policies are eroding educational attainment in Utah, and aren't improving the lot of the middle class and low income workers. Educational attainment in Washington County is especially troubling because it is 75 percent below the national average.
Business Tax Erosion
According to tax fairness experts, over the past 15 years, business tax collections as a percent of Utah GSP have declined by 40 percent. This erodes the school tax base and shifts more of the tax burden to low and middle income families. In addition, Fortune 500 companies nationwide didn't include two thirds of their pretax profits in 2003 state returns, cutting their state taxes from a nationwide average of 7 percent to about 2 percent.
There is a continuing effort by the majority party to further reduce business taxes. For example, in 2005 Utah lawmakers adopted the "double the sales tax factor" for profit apportioning to reduce corporate taxes for information technology, biotech, mining and manufacturing firms -- firms that produce in Utah but export products out of state. This tax cut eroded the school tax base over 10 years by $350 million. Utah retained the "equally weighted factor formula" so corporations could use whichever formula that would provide them with the lowest taxes. Now lawmakers are leaning towards a "single sales factor" to further reduce business taxes and the school tax base.
Tax rebates and other tax expenditure incentives are routinely provided to favored firms under Utah's economic development program. The agency providing these tax breaks tried to withhold information from the public on which firms were receiving these tax gifts. Hence, the Governor recently ordered the information to be made public. In August $8 million was given to a yogurt manufacturer who was expanding its facility, not thinking of leaving Utah and isn't a high wage paying business.
In 2006, taxes for favored corporations were cut by $20 million, including a $3 million decrease in gross receipts taxes on certain corporations not required to pay corporate franchise taxes or income taxes, and sales and use taxes for the telecommunications industry were cut by $7 million.
Sales tax exemptions have been provided over the years to numerous entities so the 2006 Legislative Summary reports $183 million in this category. This category includes $28 million for sales of natural gas, electricity, coal, and fuel oil for industrial use. Yet other firms and households routinely pay such taxes -- in St. George households pay a 3.5 percent state sales tax on natural gas as well as a 6 percent tax to the City of St. George.
Utah's School Support Ranking At New Low
Not surprisingly, the tax base supporting public schools during the past 10 years has been eroded by tax changes so that Utah now ranks 36 nationally in current school funding per $1,000 of personal income. Ten years ago Utah ranked seventh highest in this spending category.
So Utah has the largest class sizes in the nation, and ranks 51 in per pupil expenditures. Recent Utah polling data showed that 87 percent of those with children in public schools, said schools are overcrowded. Utah spending is more than $1,000 per pupil below Idaho. Only seven states have lower teacher starting salaries.
As noted above, the dual- tax cuts just enacted will further erode the school tax base by $780 million over the next ten years.
Erosion of the tax base is occurring when the school population is growing -- a 30 percent increase or 150,000 new students are expected in the next 10 years. Educational attainment in Utah is declining.
Tax Reforms -- State sales tax on food and school impact fees
Instead of the dual-tax cut, eliminating the remaining 2.75 percent state portion of the sales tax on unprepared food would have been real tax reform. Income taxes in Utah are constitutionally reserved to support public schools. Thus, sales tax reform won't further erode the school tax base and would provide needed tax relief to low, moderate and middle income families, and would be a good first step to reducing Utah's tax fairness gap.
School Impact Fees
Additionally, new-home fees should help pay for schools. Tax reform should include Utah school districts being allowed to levy impact fees on new construction to fund new growth instead of using regressive property tax increases which fall hardest on the retired and the middle class. This impact fee funding method was banned by the Legislature in 1995. This unfair decision shifts much of the tax burden for new growth to long term residents.
Tax Policy Transparency Needed
The need for tax transparency reform is evident from the Utah Tax Commission's action this year to chastise its chief economist for revealing too much information to the public about a recent tax cut proposal.
Additionally, in 2006 the Institute on Taxation and Economic Policy pointed out that Utah needs to adopt several tax policy transparency reforms. Utah doesn't routinely publish tax incidence analysis to show the impact of taxes on the different income levels. Additionally, Utah doesn't have tax expenditure reporting to show expenditure programs hidden in the tax code as breaks for favored businesses and an assessment of their usefulness. Utah also doesn't obtain basic information on taxes paid or not paid by large corporations. Utahns would obviously benefit from these recommended tax policy transparency reforms.
Summary
In summary, while regressive tax changes are being pushed by the majority party and the school tax base is being eroded, Utah's average income has declined from near the national average to 84 percent. In contrast, the average income of the top one percent has increased from an average of $826,000 to $957,000. Also the number of Utahn's without medical insurance from 2004 to 2005 grew by at least 40,000 so between 12 percent and 17 percent of the population went without health insurance including 88,500 children. The number of children living in poverty increased by 30 percent.
Also Utah's educational attainment is declining dramatically, and educational attainment in Washington County is 75 percent below the national average.
Does the majority party in Utah resemble politicians who, in the words of the Spectrum newspaper, "have become too comfortable, have been left unchecked for too long and have lost sight of the needs of their middle class and low income constitutes?"
Tax Reform
An equitable tax system adhering to the ability-to-pay principle is the foundation of the democratic process. That is why modern, enlightened nations adopt progressive tax laws. Utah's tax system is regressive and should be reformed. As pointed out by the president and CEO of Zions Bank, tax policy in Utah should be reformed to help working families. Reforms should include eliminating the tax fairness gap so that low and middle income taxpayers don't pay double the tax rate paid by households with incomes averaging $826,000.
The newly created regressive flat tax schedule should be scrapped because it adds to the tax fairness gap and isn't tax reform.
Replace the existing dual tax system with a progressive income tax similar to the Jones-Mascaro plan.
On the other hand, a formal taxpayer notification system should be quickly developed by the state to help eligible Utahns to claim the $80 million in federal EITC tax benefits they are entitled to, but are not now claiming.
Utah lawmakers should also place a moratorium on further tax cuts for businesses, and carry out a comprehensive and bipartisan review of existing business tax breaks, including an objective assessment of their fairness and usefulness as recommended by the Institute for Taxation and Economic Reform.
Education Reform
Education has been called the cornerstone of democracy and is crucial to economic growth and high paying jobs. On the other hand, schools must do all they can do to use limited tax money with extreme care to maintain public support for quality schools. In this regard most schools should operate year round to save tax money and benefit students academically.
A moratorium on creating additional charter schools should be imposed. Utah's quasi private charter schools are unlikely to provide significant academic advantages compared to public schools and too often are merely a segregated drain on funds needed for public schools.
A significant upgrading of Washington County's educational resources would help ensure that more than 16 percent of the county's high school graduates go on to earn a college degree.
In this regard, quick action should be taken to allow Dixie State College to realize it full potential by becoming a four year baccalaureate granting institution.
Washington County high schools should have a mandate to take advantage of the "how to make it to college" program AVID (Advancement Via Individual Determination) discussed at the beginning of this platform paper. AVID is now in more than 2,600 schools nationwide. AVID program initial costs per school at seven middle and high schools in the Granite School District were about $20,000. Staff to teach AVID concepts is an additional cost.
A vote for Don Miller is a vote for tax and school reform
2 comments:
Good Luck Don!
I'm happy to see another West High Alum running for the legislature. We need more West High people running for office, like ourselves.
reform is fine..don't raise my taxes.
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