March 13, 2014
Tax has become such a dirty word that leadership of the Kentucky House is hesitating to allow citizens to vote on whether local people can vote to raise their own sales
taxes for specific, time-limited local projects.
A coalition of mayors, county judges, the organizations that represent them, and the Kentucky Chamber of Commerce have all endorsed House Bill 399, which would allow a vote this fall on a constitutional amendment to enable local sales tax increases.
It has the strong support of both Lexington Mayor Jim Gray and Louisville Mayor Greg Fischer, who spoke for the measure Tuesday when it passed out of a House committee, 6 to 3.
This seems like the most basic kind of democracy: allowing people at the local level to decide whether to tax themselves for something to benefit their community. No surprise, a significant majority of registered votes seemed to understand it that way.
When asked recently about local-option taxes by the Bluegrass Poll, 60 percent favored the constitutional amendment while only 24 percent opposed it.
Despite this, the measure, may not come to a vote on the floor of the House, according
to House Speaker Greg Stumbo. Stumbo, D-Prestonburg, called the measure “bad policy.”
Under the proposal, communities could decide to raise the 6 percent sales tax by up to 1 percent for specific projects. Each increase would have to be approved separately and, when the project is paid for, the tax would expire.
Some retailers are opposed for the obvious reason that it will make their products more costly. But they will be able to raise opposition if an increase is proposed locally, and of course all local retailers would be similarly affected.
There might also be an undercurrent of rural vs. urban conflict, with concern that country people will be leaving even more money when they visit cities to shop, further diminishing their own communities.
However, smaller communities will have the same opportunity to raise their sales tax a penny to fund projects closer to home, like parks or business-district improvements.
There’s a good reason that 37 states allow local-option taxes: In a time when federal and state governments are increasingly cash-strapped and any real tax reform seems unattainable, local-option taxes provide a community the opportunity to determine its own destiny,
Polls consistently show that people have more trust in government the more local the level. They know the officeholders, they understand the issues, they see the benefits.
It’s good policy to give those voters the right to raise their taxes to improve their communities.
Stumbo should allow the House to vote on this measure.