Thursday, May 19, 2016

Republican Legislative leaders tossing around massive tax increases


The last few weeks of a legislative session tend to be the most dangerous, as far as bad legislation is concerned. That danger increases if the legislature is facing a budget shortfall, like they are right now.

House Bill 3213 was filed this week as a "shell bill" - an empty measure that serves as a vehicle to "plug" language into during the committee process. Yesterday, a committee substitute was filed, filling the empty bill with a bunch of nonsense.

Here's from the fiscal impact report prepared by House staffers:
The committee substitute for HB3213 refers to a vote of the people numerous changes to the Oklahoma sale and use tax code. If approved, the measure would increase the state sales and use tax rate from 4.5 percent to 4.9 percent and expands the list of services and property subject to sales or use tax. [emphasis mine]

The list includes:
  • water, sewage and refuse from a utility or public service company;
  • computer programming, design and analysis services;
  • repair, installation, delivery and maintenance services when provided in conjunction with the sale of tangible personal property;
  • pet grooming services;
  • landscaping services;
  • storage of furs;
  • marina services;
  • carpet and upholstery cleaning services;
  • laundry, diaper and dry cleaning services;
  • swimming pool cleaning and maintenance services;
  • exterminating and pest control services;
  • tire recapping and retreading services;
  • computer software that is electronically delivered;
  • digital products;
  • auto repair services;
  • video programming services;
  • leases and rental of aircraft;
  • overnight trailer park rental;
  • telephone answering services and welding services.

Revenue from the increased rate would be used to fund a teacher pay raise, which is authorized by a companion measure, HB3214. In the event that HB3214 is enacted into law and voters do not approve the changes proposed in HB3213, then the teacher pay raise would not be authorized.
The fiscal impact statement didn't have specific figures yet, but expanding the sales tax to cover services would be a massive tax increase on Oklahoma citizens and a further burden on small businesses and employers. Under this measure, our family carpet cleaning business (and customers) would be affected.

Another measure would have raised the fuel tax by three cents -- it failed in committee.

Another measure would have raised the cigarette tax by $1.50 -- it failed on the House floor this evening, but could possibly come back. Until the Legislature adjourns Sine Die, nothing is truly "dead" in the final weeks of the legislative session. Because enough conservative Republicans held the line, Governor Fallin went to the House floor to [unsuccessfully] try to get the Democrats to help pass the tax hike -- oh the irony... a self-proclaimed "conservative Republican" begging the Democrats to vote for a tax increase! The Democrats are holding out for the Medicaid expansion (see "ObamaCare by another name").

Another measure passed by the House requires that all vehicles registered in Oklahoma pay a $5 fee to receive new license plates next year (regardless of if you need a new one or not).

I'm sure I missed some other tax-hikes and fee-hikes, but these will do for now.

Go to OKLegislature.gov, and scroll down to the bottom right to find who your state legislator is. Contact your legislators and tell them to vote against any tax increases. You can also do it through this page from Americans for Prosperity and this page from OCPA Impact.

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