Editorial: Plan for early taxes is now fair

Friday, Feb. 28, 2003 | 5:03 a.m.

Gov. Kenny Guinn has proposed more than $1 billion in new and higher taxes to overcome projected deficits without having to impose massive cuts in service in the biennium beginning July 1. But state finances aren't faring well now, either. This prompted Guinn a few weeks ago to ask the Legislature to quickly approve a portion of his total tax package. This way, he reasoned, the state could receive enough increased revenue this fiscal year to stave off a financial crisis.

But that plan was flawed. Many legislators are skeptical of Guinn's tax. Just how many taxes are passed and at what level will be decided only after considerable legislative debate. It would have been unfair to subject a few taxes to early and permanent approval, thus denying them the opportunity for reductions or deletions later on in the legislative session when the tax issue takes center stage. If the lawmakers had decided to reject the remaining portions of Guinn's tax package, the ones imposed by early approval would have placed an unfair burden on the taxpayers affected by them.

Guinn's new proposal eliminates that danger and we support the compromise. He has now affixed an expiration date -- June 30 -- on four increases in his overall tax package that he wants approved early. This way the Legislature cannot exclude those taxes in any debates on the overall package, as they are only temporary. Because they are set to expire, the Legislature cannot rely on them as a fallback if they reject the rest of the package. And if the Legislature decides to support increases that are less than Guinn's proposal, those taxes will still be on the table for reductions as well as the other taxes in the package. The taxes proposed for early and temporary increases are those on cigarettes, liquor, slot-route licenses and the one businesses pay for each person they employ. The increases are projected to raise $80 million by June 30.

Some legislators favor an alternative -- almost totally draining the state's emergency fund to get us through till June 30. But just how close to bankruptcy do we want our state to come before acceding to the need for new taxes? Guinn's compromise plan, paired with the $200 million he has already cut from the budget, offers the best chance for keeping the state solvent while keeping the tax debate fair.