Columnist Jon Ralston: Tax need finally established

Friday, March 28, 2003 | 4:35 a.m.

Is it the Escape Taxation Caucus -- a variegated melange of biennially stonewalling special interests who always want someone else to pay?

Is it the Escape Responsibility Caucus -- a more monolithic group of lawmakers who think by standing for nothing except against taxes that they can ensure re-election?

Or is it the Escape the Past Caucus -- a diverse bunch of activists, citizens and even some legislators who believe that those who dither in the present, those who apply Band-Aids where surgery is needed, those who would rather complain than fight are consigning the state to the cellar in quality-of-life indices, where a mere national average is the holy grail?

Tuesday is April Fool's Day and never has the Carson City comedy act seemed more foolish. Worried more about politics (we can't vote for taxes twice, we must gain partisan advantage, we need to talk but not act) than policy (how should the tax base be broadened, how much should state government raise, how do we raise taxes in a time of war), the Gang of 63 is doing its best to do its worst.

Amid all the posturing, the good news can be lost. And last week's news was very good: An acknowledgement that there is a need for hundreds of millions of dollars in new revenue and that business should pay more.

Whatever you think of his plan, Assembly Minority Leader Lynn Hettrick's budget presentation last week was a watershed event for this session, much more significant than the Terry Care-Mark Amodei state Senate bill of the previous week.

Why? Because the Gardnerville Republican, with his proposal, can lay claim to three important accomplishments:

Hettrick's conservative bona fides are unquestioned. And yet he sees the need for $600 million in new taxes. So now we know the parameters -- between $600 million and the billion dollars the governor and Care-Amodei suggest.

No more talk of whether there is a need. Just how much.

So now we can see the parameters of the most salient colloquy that should take place this year: What is the difference between an enhancement and a necessity?

Some legislators have good reasons to oppose the gross receipts -- the lack of correlation between the tax and a company's profitability, the likelihood that the rate will rise. And Hettrick and others argue that a services tax is better because cheap services will not be taxed (i.e., haircuts) and that by cutting the rate, they are saving some taxpayers money.

But there are problems with it, too, including that most businesses really just collect the tax and forward it to the state while passing higher prices on to their customers. And if the gross receipts rate is likely to rise, the services tax is likely to become a Swiss cheese tax that is not broad-based because of exemptions won by lobbyists.

Most importantly, no matter how you slice it, it will not take into account those who have escaped any state taxation for years -- banks, retailers and out-of-state megadevelopers, to name a few.

This week the Gang of 63 should begin to close budgets. The governor will hold a Damoclean sword over their heads if the early tax package is not enacted. And grass-roots/public relations campaigns soon will begin for interested outside groups. Soon enough, lawmakers will have to put their votes where their mouths have been.

It would be nice to think that somewhere there is punishment for bad behavior. That lawmakers who care more about pandering than policymaking, who put personality conflicts over their duty and ambition over everything, lose their titles next November. That a governor who doesn't go the distance, using vetoes if necessary and the bully pulpit every chance he gets, suffers popularity hemorrhaging. And that special interests who promise to be part of the solution, making pledges to pay a "gigantic" or "large, large" share as the business folks have, reveal themselves to be part of the problem.

Escaping responsibility and escaping taxes always are easier than escaping the past. As we move past April 1 in The Great Tax Debate, we will soon know which group has been living in the fool's paradise.