If you think state and local taxes have been taking a bite out of you recently, you're right.
Now a new compilation of recent tax revenues shows record revenue increases since 1990 in sales and income taxes. The Utah Taxpayers Association 1995 tax summary book comes on the heels of a spring report issued by the Utah Tax Commission that shows Utahns bear the greatest tax burden, based on their ability to pay, in the Western United States.The Taxpayers Association is a nonprofit group, mainly funded by businesses, that watches state and local taxes. Its 1995 tax summary shows that since fiscal 1990, state, individual and corporate income-tax revenues have jumped 37 percent each and the 19-cent-per-gallon gas tax revenue has increased 14.5 percent. Since 1992, the state's portion of the sales tax has jumped 24 percent.
Property tax revenue - including the state-mandated school taxes, other school property taxes and property taxes to cities, counties and special districts - has gone up 26 percent.
Those are big increases and, except for the gas tax, exceed inflation and population growth over the same time.
Statistics from the University of Utah's Bureau of Economic and Business Research show that inflation since 1990 has run 17.5 percent. The U.S. Census shows Utah's population has grown by 10.1 percent from 1990 to 1994. Add together inflation and population, and tax revenue from the sales and income taxes has grown faster than the pair.
"That's why we've given some tax relief recently," says Senate President Lane Beattie. "We're going to have to watch these revenues - especially the corporate franchise (income) tax." A hot Utah economy pushed the corporate income tax revenue up 31 percent from fiscal 1994 to 1995.
However, don't expect much tax relief in 1996. Gov. Mike Leavitt and legislative leaders are studying ways to raise more than $2 billion for transportation and water needs.
"We've said for some time that we may need some of this general revenue for those items," said Beattie. That means sales taxes could be shifted to road needs. The Utah Constitution says all income tax monies must go to education. The state has the ability to levy a state property tax, but hasn't done so for years.
The Legislature does mandate that local school districts levy a special property tax, which then flows into the Uniform School Fund to be sent back to the 40 districts via an equal-funding formula. Those monies wouldn't be used for roads. That leaves the sales tax and other special taxes.
Lawmakers cut the state sales tax by an eighth-cent last year - about $26 million. But still, the state's sales tax revenue grew from $978 million in 1994 to $1.05 billion in fiscal 1995, which ended June 30, the Taxpayers Association reported.
Legislators and Leavitt gave a $90 million property tax cut and avoided another $50 million in certain property tax increases in 1995. But those cuts won't show up until 1996. Property tax revenue across the state has risen from $761 million in 1989 to $1.03 billion in 1994, the last reporting year.
"We have to be very concerned about rising property taxes," said Beattie, who is a real-estate broker. "We can't let what happened in California happen here. There, rising property prices raised valuations, which raised property taxes to the level where some people - especially the elderly - couldn't afford to live in their own homes."
But property taxes are tied to schools, cities and counties. Cuts in those revenues just hurt the areas of government least able to meet growth needs, says Thayne Robson of the Bureau of Economic and Business Research.
"What we're really seeing in these revenue increases is that the governments most impacted by growth - cities and counties - aren't getting the money. The state is. From a financial and tax standpoint, we are very ill prepared to meet the needs of growth."
Robson points to the new, huge Micron plant now under construction in northern Utah County. "Lehi will be greatly impacted. They're trying to put together a $63 million program to accommodate the plant and the people moving in. But Lehi won't get the benefit of generated taxes from Micron - the income taxes and the sales taxes. Most of that will go to the state, which is only making a modest donation to Micron's cost of coming here."
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ADDITIONAL INFORMATION
Tax revenues
INCREASE
FISCAL 1990-95
Individual state income tax up 37%
Coporate state income tax up 37%
Gasoline tax up 14.5%
Property tax up 26%
FISCAL 1992-95
State sales tax up 24%