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Sunday, September 17, 2017

Permanent temporary penny

That "fiscal cliff" is still looming. Doesn't look like we're any closer to the equitable fiscal reform lawmakers promised would come when they voted for this "temporary" sales tax As we continue to watch them argue about this, there are two things to remember about the sales tax. 1) It is an unfair burden on the state's poor and middle class. 2) It is bolstered by support from powerful (and traditionally Republican) lobbying groups.
Some Republicans said they voted for the extra penny in 2016 only because they assumed more fiscal reform would be put in place before it the temporary tax expired. Comprehensive reform hasn't happened, largely because the Legislature hasn't been able to agree on a permanent solution.

"I will be voting no on the penny, I can assure you of that," said Rep. Kenny Havard, R-Jackson. "All I hear about is the penny, and I don't think they have the votes to keep the penny on."

Havard and (State Sen J.P.) Morrell said business lobbyists are pushing for keep the extra penny tax because their business clients have exemptions from it on some big purchases. Further, if the sales tax stays in place, it makes it less likely that other taxes on businesses will be implemented or that tax exemptions for industry will be eliminated.

"People who have sales tax exclusions are simply convinced we are going to tax everyone else," Morrell said. "The reason that some people are bullish on the sales tax is [that] they don't have the sales tax."
The true genius here politically is that, because the Republicans don't actually care whether or not we go over the fiscal cliff, they aren't about to lift a finger to do anything about the special exemptions Morrell is talking about there. This way they leave Democrats cornered as half hearted supporters of the hated sales tax. And, of course, they're all too happy to pin that on the Governor.
(State Rep Cameron) Henry, who helps build the annual state budget as House Appropriations Committee chairman, said he expects Edwards to engage in fear mongering over the next few months. He predicted that Edwards will threaten to cut the popular TOPS college scholarship program and services for disabled people if the Legislature doesn't raise taxes. These programs have been cut since 2016, when the state last faced a billion dollar deficit, and Henry said the governor threatened to cut them as "a tactic" to pressure legislators into raising taxes.

He also implied that the governor, though not most legislators, is pushing the idea of keeping the sales tax rate at 5 percent. Edwards has indeed said he might be open to extending the 5 percent sales tax rate beyond June 30, but only if it was again done on a temporary basis and passed alongside permanent taxes that would kick in once it expired.

"It will be the permanent, temporary penny," Henry said in the video. "I think anyone who falls for that is really doing a disservice to their state and their constituents.
A "permanent temporary penny" suits Henry just fine, of course. It gives him an issue he can complain all about all day even as he has no incentive to actually do anything about it. All of which is why next year in the legislature will be exactly like the previous two. It's a permanent strategy meant to make this governor's term as temporary as possible.

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