CITIZENS   FOR  LIMITED  TAXATION  &  GOVERNMENT
and the
Citizens Economic Research Foundation

 

NEWS RELEASE
Tuesday, March 12, 2002

A CLT MEMO TO THE LEGISLATURE:
A Fiscal Policy False Choice


To:  Members of the General Court
       March 12, 2002

We are not going to choose among a list of sixteen tax hikes. It's a false choice.

The proper question that you in the Legislature should be asking is: "Would you prefer that we increase your tax burden, or reduce our spending that has doubled the budget since the last time we raised your taxes 'temporarily'?"

We taxpayers, one way or another, provided the entire $22-plus billion that the state spent last year, and now Rep. Rogers is threatening us with sixteen tax hikes to spend even more? Until the income tax rate drops back to 5%, we are still paying for the last time the state government spent too much, caused a "fiscal crisis," and raised our taxes instead of taking responsibility for its lack of control. In fact, we're paying over $11 billion a year more. State spending has increased at roughly twice the rate of inflation.

Don't cut the personal exemption; it should be indexed to inflation and increased every year. The income tax rate should be 5.3% this tax year, 5.0% next tax year -- just as 59% of the voters mandated. The charitable deduction is another voter mandate. Increased "sin taxes" will drive sinners to New Hampshire, where they'll also shop to avoid the sales tax. As for the capital gains tax, you traded that tax cut for your 55% pay raise. A deal is a deal: if you hike the tax, cut your pay. But we think your 1998 constitutional pay amendment requires that you first take it, pay taxes on it, then donate it. Ditto your "furlough."

If you want to raise the gas tax to pay for the Big Dig, put it on the ballot; you can explain during the campaign why we were told when the project started that it would only cost $2.6 billion. Leave the rental deduction and everything related to Prop 2½ alone; it's the one thing the Legislature can take credit for implementing well.

Municipal officials who want you to repeal Prop 2½ and/or raise the income tax rate have themselves increased budgets as if the good times would go on forever. At the beginning of this fiscal year, free cash in 284 reporting communities equaled the amount that Framingham selectmen want you to hike the income tax: e.g., Framingham had $3.2 million, Natick $3.58 million, and Fall River $10.6 million -- of the $471,647,417 total.

The recession has ended. Use the rainy day funds and tobacco settlement money, delay acceleration of pension payments, use this opportunity to initiate reform, thank the taxpayers who pay the 5th highest per capita taxes in the nation, and respect the will of the voters.

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