Lawmakers eye possible tax increase to close $850 million gap

Lawmakers eye possible tax increase to close $850 million gap

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SALT LAKE CITY -- Talk of a tax increase is building on Utah's Capitol Hill, as lawmakers eye an $850 million budget shortfall.

House Republican leaders are on the record as saying the problem can't be solved by cuts alone -- $100 million in new taxes will be needed.

Even after lawmakers made a round of significant cuts, Utah Taxpayers Association Vice President Royce Van Tassell says there is room for more cuts.

"Through the transparency website we discovered that the state had already spent $250,000 on bottled water," Van Tassell tells KSL Newsradio. "That's just scratching the surface."

Van Tassell says the association believes a tax increase would be harmful to the state's economy.

"I think one of the real dangers of a tax increase would be to stymie any nascent economic recovery," Van Tassell says. "The economy is still fragile."

House Republicans tell the Deseret News closing the gap only through cuts would seriously hurt education and human services.

Senate President Michael Waddoups says he believes the state should be able to get by without any tax increases, but lawmakers will likely have to delve deep into the rainy day fund -- likely taking more than half of the more than $500 million total set aside for the general fund and education.

"The governor has committed to putting forward a budget with no tax increases and I'm committed to supporting him in it," Waddoups says.

Waddoups acknowledges there is support in the Senate for a cigarette and tobacco tax. He says a return of the food tax would be revenue neutral, but he says that kind of tax will struggle to pass in the House and may see resistance in the Senate.

Senate Republican leaders say they probably have the votes to pass a cigarette and tobacco tax next session.


Story compiled with contributions from Andrew Adams and Marc Giauque.

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