More than Nickels and Dimes in Tax Plans

A little bit here, a little bit there. Eventually, it all adds up to something more than a little bit. That seems to be legislators' early plans for plugging the budget shortfall. I write about it in The News Tribune. The marketing push behind the tax plans involves linking a tax to a public benefit, the way the governor did a few years ago in tying the estate tax to education.

From snuff to muffins, anything that somebody thinks is bad for you justifies a tax for something good.It’s all marketing. Matching taxes with popular social or political objectives to minimize opposition has been elevated to an art form in Olympia.

In a very clever column, TNT columnist Peter Callaghan points out the problem. 

Do you believe the state Legislature can find $750 million to help fill a $2.6 billion budget hole without raising the sales tax, the property tax or the business and occupation tax?

If you do, you might also believe in the Tax Loophole Fairy.

Read the whole thing. As Callaghan writes, there's no TLF. When the legislature gets serious about raising taxes, and they will soon, they'll turn to the Big 3 (sales, property, business).

For now, though, we have the candy tax, bottled water tax, attempts to re-write tax incentive laws, and pleas to Congress for federal money.

The governor's more comprehensive tax plan will come out February 12. From the TVW blog:

This morning in her press conference, Gov. Chris Gregoire said all tax options are still on the table — though she said property taxes and across-the-board B&O tax increases are difficult — and that she’s still hopeful for federal help.

In today's editorial, the Olympian reminds its readers that state employees may see more compensation reductions.

State employees and their union leaders already have made sacrifices, but the budget deficit has grown. The challenge is to maintain the strength of core services through the next few budget cycles, not just this one. The private sector continues to see reductions in hours, pay and benefits, and state workers must brace themselves for additional cuts.

Tense times.