Vexing Utah tax reform seems to take on more drama as the latest Republican plan was described as “close,” and House Democrats released their own proposal.
At issue is how much you’ll pay in state income and sales taxes, and for what.
Senate President Stuart Adams and House Speaker Brad Wilson went to the Governor’s Office for a meeting Thursday afternoon, aimed at coming to terms on a big tax overhaul, that has drawn pushback since Republican leaders unveiled their first measure last winter.
That one was put on ice just days after launch, in the face of opposition from small business—concerned about new taxes on services—and from educators, who said cutting state income taxes will hurt schools.
“When I hear people give opposition, they don’t really understand, and maybe that’s our fault for not getting the message out,” said Sen. Lyle Hillyard (R-Logan) co-chair of the Tax Reform Commission, who maintained the state needs to modify its tax structure given budget needs, and a changing economy.
The latest GOP tax reform version came out before Thanksgiving—cutting Utah’s flat tax about a third of a point, upping taxes on food, gas, and imposing new sales taxes on shipping, storage, parking, and tickets to college athletic events, among other things.
It spurred speculation Gov. Gary Herbert would call a special session by now, which as of Thursday, had not happened.
“I think we are really, really close,” said Hillyard.
The Governor’s Office said “negotiations are ongoing, and we have no further comment at this time.”
Meantime, House Democrats released their own plan that would scrap Utah’s 4.85% sales tax rate, impose a .9% gross receipts tax on business sales of goods and services, and reduce income taxes for people making up to $150,000—but raise income taxes for everyone making more.
“How do you sell an income tax hike?” 2News asked Rep. Brian King, House Minority Leader.
“Well, the only way that you sell it is you ask people who are in the best position to step up to the plate and contribute a little more to do so,” he replied.
King called the Democrats’ plan “simple and fair,” and a net tax cut for most people in Utah. Republicans have insisted their latest tax proposal is also a net tax cut.
In a statement, Speaker Wilson asserted the Democratic plan would “strike a blow to the principles that have made Utah strong.”