Vague proposals to cut taxes but somehow increase revenues don’t make sense and come off as weak cover to mask an apparent agenda. Despite the ideological impulses of the Legislature to continue “reforming” the tax system in Utah, they are willfully ignoring a few key elements essential in any policy debate about taxes.
The “sweeping overhaul” to the tax system released recently is clearly determined to reduce the income tax and raise the sales tax, in spite of public opinion otherwise. While it may “broaden” tax revenues, it also shifts a proportionate burden of overall taxation from those with higher incomes to those with lower incomes. The income tax can be a progressive tax, which means that it can tax higher incomes proportionately at a higher rate. In contrast, the sales tax is called a regressive tax because it burdens the poor and lower incomes disproportionately in comparison to a person of higher income.
Despite the somewhat weak and unconvincing public spin, the point of the current debate isn't just about tax bills increasing or decreasing, but rather a radical, ideological change in how we approach an economically stratified society.
Progressive and regressive taxes, user fees, flat rate taxation, administrative fees, permit and licensing fees — they all have pros and cons. But, in a complex way, they can all be used to provide appropriate revenues so our government functions in a fair and equitable way.
All of these elements, including the social impacts of taxation on different economic levels, should be included in the debates.
This debate is far from over and I hope we can sensibly work in our public policy deliberations to create and accept a balanced way to provide for our government, addressing these pros-and cons. This legislative proposal clearly doesn’t.
Keith Homer, Midvale