Three leading Democrats urged party colleagues and Utahns in general to support an initiative to remove the sales tax on food this November and reject "the irresponsible and vindictive threats" they say GOP Gov. Norm Bangerter is making against state programs if the initiative passes.
Former Democratic Gov. Scott M. Matheson, state Democratic Party Chairman Peter Billings, Jr., and state senatorial candidate Karen Shepherd called a news conference Wednesday morning to say they will recommend to the Democratic state convention in two weeks that delegates formally endorse taking the sales tax off food.Merrill Cook's Independent Party of Utah gathered 69,000 signatures this year to get the food sales tax removal initiative on the November ballot. Bangerter says he opposes the tax removal and pledges to cut the estimated $90 million the food tax brings in to state coffers from state programs should voters approve the initiative.
Bangerter says he won't support a tax shift to offset the revenue loss if citizens go against his warnings and pass the initiative. The governor doesn't want to cut $90 million, but he says he will.
"The governor stated that he will personally vote against the initiative. However, if the public wants it, they must understand the consequences. The governor will not raise taxes. That means there will be less money for services - not only in state government, but in local government," said Francine Giani, the governor's press secretary.
"And citizens of Utah should be asking their elected officials exactly what the impact will be on local services."
Republican Party officials, on the other hand, believe delegates to their state convention a week from now will choose not to address the sales tax issue at all - but remain officially neutral.
Matheson, who retired from the governor's post in 1985, said the time is right, the cause is just and the sales tax on food should be removed now. "We must protect local government from cuts; they are more strapped than the state. And we must address the question of tax fairness. This is a major first step," the former governor said.
He added that there are some 30-odd exemptions to the current sales tax that should be studied to see if they are appropriate.
Billings said the 30 exemptions could equal $30 million, and combined with fair and just state income rebracketing and revenue growth in a robust economy, could make up the $90 million loss.
"Unlike the sponsors of the initiative (Cook and his followers), we make our recommendation of support with the clear understanding that the next Legislature will have to adjust other taxes if the initiative is adopted by voters in November," said Billings. "There is no free lunch."
He went on to say that Bangerter has made irresponsible and vindictive threats to cut badly needed state programs if the initiative passes. "I don't believe the voters should give in to such blackmail. Utah can have both tax fairness and adequately funded programs. The governor and the Republican Legislature gave tax cuts in 1988 and 1989 which primarily benefited the wealthy. It is time for a tax cut that benefits the middle class."
Matheson and Shepherd co-chair the Democratic Policy Commission that will recommend to the Democratic convention ways to restructure Utah's taxes. One possible reform, Billings suggested, is the removal of the federal income tax deduction on state returns and rebracketing of state income tax to leave 60 percent of state taxpayers at the same or lower levels.
"That would raise $30 million in additional revenue and be a fair and just change," Billings said.
Shepherd said that advocates for public employees, human services and higher education should not be blackmailed by Bangerter into opposing the sales tax initiative. Such groups as the Utah Education Association and Utah Public Employees Association traditionally oppose any tax reduction, fearing the impact on their members.
"I know they fear the loss, but that doesn't need to happen. Care can be taken and through (overall tax reform) they can gain, not lose," Shepherd said.