Va. House Proposes Heavier Tax On Business
GOP Stuns Opposition By Attacking Exemptions
By Michael D. Shear and Jo Becker
Washington Post Staff Writers
Tuesday, February 17, 2004; Page A01
RICHMOND, Feb. 16 -- Republicans in Virginia's House of Delegates endorsed a plan Monday to end tax breaks for many businesses, joining Gov. Mark R. Warner (D) and the Senate's Republican leaders in calling for new revenue to balance the state's budget.
Faced with the prospect of closing Virginia's $1 billion budget gap with deep cuts to popular programs, the GOP-controlled House instead voted 59 to 36 to raise $520 million by eliminating sales tax exemptions enjoyed by utility companies, the shipping industry, airlines, dry cleaners, telephone companies and other businesses. House leaders expect the bill to receive final approval Tuesday.
The plan, first put forth by Republican leaders just 80 hours before the vote, turned the Capitol's tax debate on its head. Business lobbyists, Democratic legislators and Warner administration officials gathered for their own tense, closed-door strategy sessions and wondered what to make of a GOP plan that targets the party's traditional business allies.
Proponents of the House measure said they are seeking to solve the state's budget problems without raising sales and income taxes on average citizens. And they said the vote sends a message to business groups who have endorsed the broader tax plans offered by Warner and John H. Chichester (R-Stafford), chairman of the Senate Finance Committee.
"You can't say, 'We need more revenue, we need more revenue, but not this new revenue,' " said the bill's sponsor, Del. Phillip A. Hamilton (R-Newport News).
The bill won initial approval over the objections of almost all of the chamber's Democrats, who complained that they had too little information about a plan that they say could threaten Virginia's job growth and the state's overall economic recovery.
"We're legislating in the dark," said Del. Brian J. Moran (D-Alexandria).
And it passed despite some dissension among the Republican majority. Some GOP delegates said their party should not be buying into the argument that Virginia's 7 million residents need to pay higher taxes for a growing government.
"I'm suggesting to you we are caving in to a lack of information," thundered Del. Robert G. Marshall (R-Prince William), an ardent opponent of tax increases. "No case has been made to increase revenues, and this will increase revenues. That's the purpose of it."
Posted by P6 at February 17, 2004 08:01 AM
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Comments
"I'm suggesting to you we are caving in to a lack of information," thundered Del. Robert G. Marshall (R-Prince William), an ardent opponent of tax increases.
The Right Hon. Delegate is being facetious, no doubt. As a Californian subjected to the heartbreak of this magnificent state being systematically rendered ungovernable by tax-cut fundamentalists, I have had many occasions to read anti-tax rants each primary and general election of every other year in California. The recall election was also attended by invading hordes of hysterics who thundered that all taxation was theft.
It is rare for such people to understand anything about government or civics. Indeed, in my experience, such knowledge is held in active derision. Arguments include the one motivating CO's TABOR* or complaints about about "socialism permeating the industrialized world," due no doubt to liberal college professors and their minions in places as diverse as Alberta, South Korea, Taiwan and the Netherlands. Even think tanks like the NCPA, the Cato Institute, or the Heritage Foundation shows an active contempt for public policy or honesty. The mere fact that the role of government has grown in the 20th century is cause for outrage. Little reflection is given to the fact that all classes of society have conspired to do this.
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* TABOR: TAxpayer's Bill Of Rights; constant-$ per capita state budget is not allowed to grow year-on-year; since budgetary demands are cyclical, it is likely that in some years the state budget would shrink. That would become the new baseline.
Nearly all of the things that constitute the state budget are expenses which, for private enterprise, have grown faster than inflation. Health care, provided through the private sector, needs no introduction. Liability insurance has also grown, raising the costs of operating private schools as well as public; and, of course, mean wages have grown faster than inflation (albeit only very slightly).
Posted by James R MacLean at February 17, 2004 01:55 PM