'Shell game' or 'hysteria and myths'? Poll says majority of Utahns against tax reform

'Shell game' or 'hysteria and myths'? Poll says majority of Utahns against tax reform

(Carter Williams, KSL.com, File)


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SALT LAKE CITY — More than two-thirds of Utahns oppose the key pieces of state tax reform — lowering income taxes while raising sales taxes on food, gas and some services — that was passed in a special session of the Utah Legislature, according to a new poll released Monday.

The UtahPolicy.com poll found that 68% of Utahns oppose tax reform legislation containing those elements, compared to 31 percent who said they are in favor. While the number of opponents are equally split between describing themselves as somewhat or strongly opposed, just 5% of supporters felt strongly.

Fred Cox, the former Republican state lawmaker from West Valley City behind the referendum to repeal the tax reform law, said he’s not surprised by the poll results.

“That’s certainly what I’m running into,” Cox said. There are already some 3,600 referendum petition packets, each with room for 49 voter signatures, circulating around the state, he said — a number that’s expected to rise to 5,000 by the start of next week.

In order for voters to be able to decide in the November 2020 election whether to keep or reject the tax reform law, referendum backers will need to gather nearly 116,000 signatures divided proportionately among at least 15 of the state’s 29 counties by Jan. 21.

Not a problem, Cox said, although he doesn’t yet have a count on how many signatures have been collected.

“I know that we’ve turned in a number of packets. I know we’ll keep the county clerks busy,” he said, adding it’s been difficult to keep up with the demand from Utahns who want to circulate and sign the petitions. “I just keep getting requests.”

A Facebook group putting together signature-gathering events now includes more than 16,000 members. Cox said he’s heard reports of organizers running out of petitions at at least one event before everyone who showed up had a chance to sign.

So far, the referendum’s political issues committee has reported raising nearly $10,000 of what Cox said will cost $26,000 to print 5,000 petition packets that must contain a copy of the 200-plus-page tax reform bill. The goal, he said, is to gather at least twice as many signatures as required to ensure enough can be verified.

While a majority of Republicans, Democrats and independents were all against tax reform in the poll, the strongest opposition comes from independents, independents who lean Republican, and moderate Republicans and Democrats.

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The poll was conducted for the online political news source by Y2 Analytics before the special legislative session on tax reform, from Nov. 19 through Dec. 7 of 911 registered Utah voters and has a margin of error of plus or minus 3.4 percentage points that’s higher for subgroups.

Referendum backers include most of the Republicans running so far to succeed Gov. Gary Herbert, who is not seeking reelection after more than a decade in office, former Gov. Jon Huntsman, Jr., Salt Lake County Councilwoman Aimee Winder Newton and businessman Jeff Burningham.

Another GOP candidate in next year’s crowded race for governor, Lt. Gov. Spencer Cox, came out against tax reform but isn’t taking a stand on the repeal effort because his office oversees referendums as part of the elections process.

LaVarr Webb, UtahPolicy.com publisher, recently editorialized against the GOP gubernatorial candidates supporting the referendum, saying they lack courage and “are pandering to the baser instincts of voters. They are not looking at what’s good for the state, but what they think is good for their election prospects.”

Monday, the Utah Taxpayers Association also brought up the Republicans running for governor and backing the referendum, warning in a news release that the “volume of hysteria and incorrect information based on myths and falsehoods surrounding the tax reform bill is becoming almost deafening.”

At the top of the association’s list is the reduction in the state income tax rate from 4.95% to 4.66%, called “critical in keeping Utah ahead of other states that are nipping at our economic heels” and “essentially a pay raise for Utahns which would far outweigh the increase in sales tax they will pay on groceries.”

Webb said Monday that while it’s easy to criticize tax reform now, he believes the public will come around once they add up the tax savings. Overall, the tax reform package cuts taxes by $160 million annually, plus provides another $72 million in one-time rebates to low- and moderate-income Utahns.

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“I just think there’s a lot of misunderstanding about tax reform,” Webb said, with taxpayers looking only at the increase in sales tax on food from the current 1.75% to the full 4.85% state rate, and the additional sales tax to the wholesale price of gasoline, expected to boost the price at the pump by about 10 cents a gallon.

There’s “a visceral negative reaction to those two things. I think that most people are focused on that and not on the fact that overall, it’s a pretty decent tax cut especially for the middle class and low-income people,” he said. “The proponents of tax reform simply haven’t made the case to the general public.”

Tax reform, which is vulnerable to a referendum after failing to win the support of two-thirds of the Utah Legislature, is intended to address lagging growth in sales tax revenues compared to income tax collections, a result of consumer spending shifting from goods to services.

Because the Utah Constitution requires income taxes to be used only for education, the slowdown in sales tax revenues is poised to impact the rest of the state budget. Webb said opponents of tax reform are ignoring what he calls “a good start” at rebalancing the state tax system.

Cox disagreed.

“I just feel like the whole bill is going in the wrong direction. It’s not just one thing,” he said, citing multiple changes made to income and sales taxes that will impact what’s available for education and other needs. “What I’m seeing is a shell game. ... This bill is full of new taxes.”

Lawmakers are expected to take up education funding during the 2020 Legislature that begins in late January, likely considering starting the process to amend the Utah Constitution to remove the earmark for education while making it easier for local school districts to raise property taxes.

Transportation is also a big part of tax reform, with language in the legislation calling on state officials to come up with an alternative to the existing gas tax and the new sales tax.

Other changes include increasing the number of people in a vehicle allowed to use a high-occupancy vehicle lane without paying a toll from two to three beginning in 2025.

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