The gory details on the tax hike “compromise”
The numbers are out on the conference committee’s tax hike plan…and if anything, it’s worse than we thought.
For starters, the plan raises taxes by $682 million annually (once fully implemented) at the state level for transportation, and by another $135.5 million for other stuff. That’s over $817 million in tax hikes, just from Richmond alone.
Moreover, the plan also gives localities in Northern Virginia and Hampton Roads the “option” of raising taxes by a total of $475-$550 million annually. UPDATE: The local tax hikes include a 1% sales tax, an increase in the grantor’s tax (that’s right, they’re taxing real estate sales as we’re still trying to recover from the housing slump), and a hotel occupancy tax (which will hit business travel).
I should note that just about every previous “local option” tax increase package has included the financial version of a gun to the head of localities to force them to enact them. I don’t have the language of the conference committee version, so I can’t say for certain if this one includes it, too. That said, odds are the localities will knuckle under, meaning the annual tax increase is likely to be roughly $1.3 billion annually.
Not even Grover Norquist thought it was that high at first.
Yet even that isn’t enough for folks like the Northern Virginia Transportation Alliance, whose leader is looking forward to “being able to build on this in the future” (Washington Post).
In fact, Virginia stands at a crossroads (especially Virginia Republicans). Do we simply shrug our shoulders and do what is easy (raise taxes with the premise that we can do it again)? Or do we recognize the economic damage that would be done by a tax increase, roll up our sleeves, and take a cold, long, hard look at the Virginia budget to determine what is not as high a priority as transportation (as well as determining within transportation what should be a state function and what shouldn’t)?
The House has this tax increase (known as HB2313) on their calendar today. There is still enough time to stop it, enough time for state leaders who have currently been silent – are you reading this, Mr. Cuccinelli? – to stand up for the taxpayer and make themselves heard. UPDATE: Ken has put out a confused statement approving of “localities…given more authority” but opposing tax increases. Given that the bill disguises the latter as the former, I’m not sure where Ken lands on this.
Cross-posted to the right-wing liberal
One Response to “The gory details on the tax hike “compromise””
[...] Virginia Republican Governor Bob McDonnell has a lot of explaining to do. He aligns himself with the party that claims to stand for less taxes and smaller government, yet he embraces a plan to place a crushing tax hike on Virginia citizens. Virginia Virtucon has the details. [...]
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