SALT LAKE CITY — Now that the Utah Legislature's tax reform task force is finally in place, work can get started on finding a solution to the state's shrinking sales tax base that's been expected to be considered in a special session this fall.

But Senate President Stuart Adams, R-Layton, said the Tax Restructuring and Equalization Task Force created before the 2019 Legislature ended in mid-March may need more time.

"We're looking to do the right thing. We're not looking to put a time limit on it," Adams said. "If we can get it done within the period of time that we can have a special session, fine. If we can't, we'll take the time we need to."

The Senate leader said he was more concerned with setting a "quality limit" and coming up with a tax structure that puts "Utah in a position to be ready for the next century."

House Speaker Brad Wilson, R-Kaysville, said he believes it's likely there will be a special session to tackle tax reform before the 2020 Legislature begins in late January.

But the task force is "not going to work toward a date," he said.

A special session "would be my hope. But again, policy is more important than checking the box we had a special deal to deal with it," the speaker said. "This is a big issue for the state."

Related:

Bill putting sales tax on food was ready to go this session

Senate leaders readied legislation to restore the full state sales tax on food after the House's efforts on tax reform faltered last week, but now want to see the issue taken up by a new legislative task force.

House and Senate leaders announced the membership of the task force Monday.

The group is made up of 10 lawmakers and four nonvoting tax experts, and will be led by Sen. Lyle Hillyard, R-Logan, and House Majority Leader Francis Gibson, R-Mapleton.

The Senate members are Sens. Curt Bramble, R-Provo; Kirk Cullimore, R-Draper; Lincoln Fillmore, R-South Jordan; and Senate Minority Leader Karen Mayne, D-West Valley City.

The House members are Reps. Tim Quinn, R-Heber City; Robert Spendlove, R-Sandy; Joel Briscoe, D-Salt Lake City; and House Majority Whip Mike Schultz, R-Hooper.

The tax experts include Keith Prescott, who has headed the Utah Tax Review Commission, and Gary Cornia, a former dean of the Marriott School of Management at Brigham Young University.

The pair helped draft then-Gov. Olene Walker's tax reform plan in 2004 that called for taxing services and a flat income rate. Lawmakers ended up adopting a 5 percent state income tax rate, but did not deal with taxing services.

The other tax experts named to the task force are Kristen Cox, executive director of the Governor's Office of Management and Budget, and Steve Young, a tax attorney.

During the 2019 Legislature, a Republican leadership-backed bill that would have broadened the sales tax base by imposing new taxes on services ranging from haircuts to legal advice was pulled amid protests from businesses and consumers.

The bill, sponsored by Quinn, would have lowered the state's now 4.85 percent sales tax rate as well as the state income tax rate, with breaks for families, seniors and the poor and an overall $75 million tax cut.

Related:

Utah lawmakers pull plug on tax reform this session

Gov. Gary Herbert and Republican legislative leaders suddenly scrapped — at least for now — a tax reform plan extending sales taxes to services.

Wilson said the task force plan will include a tax cut. The state budget passed last session sets aside $75 million for that tax cut, but Wilson said "depending on how the economy's doing, it could go up or down."

Taxing services is still on the table for the task force, but other options are also expected to be considered, such as restoring the state sales tax on food, road user fees like expanded express lanes and boosting statewide property tax rates.

Even using the tax collected on state-controlled alcohol sales for more than funding school lunches is a possibility, as is amending the Utah Constitution to allow income taxes to be spent on more than education.

The issue facing state finances is income tax revenues are outpacing growth in sales tax collections as consumer spending steadily shifts from goods to services and reduces the sales tax base that funds all government services other than schools.

"I believe we need to look at every option. The solution to this is probably a combined effort," Adams said. "Whatever changes we make, it's got to be a significant improvement. We don't want to go backward."

Even though the first meeting of the task force has not yet been announced, there is already plenty of interest in what's going to happen with tax reform.

The speaker said probably starting next month, the task force will "fan out across the state and help people understand the challenges and opportunities we have" through public meetings.

On Wednesday, the Utah Eagle Forum will hold a forum on the issue starting at 10 a.m. in the Provo Library, featuring Gov. Gary Herbert, Wilson, Senate Majority Whip Dan Hemmert, R-Orem, and Phil Dean, state budget director.

Utah Eagle Forum President Gayle Ruzicka said the forum will be an opportunity to hear how possible changes to the tax structure would affect families.

"There is no room in the family budget for an increase in taxes. Businesses certainly cannot afford to pay taxes on services, which they will then pass on to the consumer," she said. "Any increases in taxes will always come back to hurt the family."

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