Arizona will never enact genuine tax reform so long as Prop. 108 (1992) remains law

Posted by AzBlueMeanie:

I have posted about Prop. 108 (1992), Arizona's "mini-Prop. 13" initiative, many times over the years. Prop. 108 amended the Arizona constitution to require a two-thirds vote by each chamber of the State Legislature when passing any legislation to increase state revenues through a change in tax allocation, such as an increase in taxation levels, or a reduction in tax credits and tax exemptions. Voters passed this proposition by a margin of 3-1 in 1992, the single most irresponsible and ignorant thing the voters of this state have ever done to themselves.

Since the passage of Prop. 108 in 1992, the Arizona legislature has not enacted a tax increase. The only tax increases enacted since 1992 have been the result of citizens initiatives to increase taxes on ourselves -- over the objections of our state legislature -- for education and health care initiatives.

The Arizona legislature has, however, enacted a series of income tax rate cuts, property tax rate cuts, and adopted a myriad of tax exemptions and tax credits since 1992 that have had the effect of reducing state revenues. When the state's population was growing rapidly and the economy was growing along with it, the Arizona legislature could use the resulting increase in tax revenue as an excuse for giving away annual tax cuts as a gimmick for their reelection.

[Note: The increased tax revenue was due to rapid population growth. It was not a validation of supply-siders' "tax cuts lead to greater tax revenue and pay for themselves." Rapid population growth masked the long-term effects of these tax cuts.]

The problem with Prop. 108 is that these tax cuts, tax exemptions and tax credits became "permanent," because the two-thirds super-majority rule empowers a minority of Grover Norquist worshipping anti-tax zealots who can engage in an undemocratic tyranny of the minority to block any reforms to tax laws (much the way the U.S. Senate abuses the cloture rule to filibuster bills).

Since 2007 with the collapse of the housing bubble, the severity of the Bush Great Recession, and the population of Arizona slightly decreasing for the first time in our history, these tax cuts, exemptions and credits have resulted in a structural revenue deficit requiring draconian budget cuts to vital programs in public health, education, and welfare only because of the two-thirds super-majority requirement of Prop. 108 and our Grover Norquist worshipping anti-tax zealots in the Arizona legislature who refuse to raise taxes at any time under any circumstances.

I have heard a number of candidates from both political parties say during this campaign that we need tax reform in Arizona to address our structural revenue deficit and to make our tax structure more fair and equitable. But we cannot have a serious discussion of tax reform in Arizona so long as Prop. 108 remains law and empowers a minority of Grover Norquist worshipping anti-tax zealots who can engage in an undemocratic tyranny of the minority to block any such tax reform. The democratic principle of majority rule must first be restored before tax reform can seriously be considered.

I cannot take any candidate seriously who does not acknowledge the undemocratic nature of Prop. 108 and advocate for its repeal, and at the same time claims to support tax reform. Any candidate who says they support tax reform but does not advocate for repeal of Prop. 108 is just talking up their sleeve. It is an empty promise never to be realized.

Since Prop. 108 was enacted by a citizens initiative it must be repealed by a citizens initiative or referendum referred by the state legislature. After the November election it is time for stakeholders who care about the future of this state and understand that genuine tax reform is necessary to come together and to begin the task of putting repeal of Prop. 108 on the ballot in 2014. The new legislature in 2013-14 can refer repeal of Prop. 108 to the ballot, or a citizens initiative must begin the arduent task of collecting enough signatures to send an intiative to the ballot. But let us begin the task of restoring tax sanity to Arizona.

Comments

[Thane "Goldie" Eichenauer]

"...we need tax reform in Arizona to address our structural revenue deficit"

There is no so-called structural revenue deficit only a predisposition of government to spend more money than it has. The state of Arizona currently has a $1.5 billion dollar operating balance. Show me the deficit.

http://www.azcheckbook.com/

As for "Grover Norquist worshipping anti-tax zealots" I don't think that Grover is the problem but the idea that government can and should be called upon to solve every problem of humanity. I believe that there always have and always will be problems that need to be addressed. I think that many if not most problems can be solved better, faster and cheaper without government being used.

http://c4ss.org/content/12563