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Walker's Tax Reform Plan Could Be Dead on Arrival

Walker's Tax Reform Plan Could Be Dead on Arrival

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SALT LAKE CITY (AP) -- Delays in creating a sweeping tax reform proposal that Gov. Olene Walker commissioned months ago now seem likely to kill the measure when her term expires in January.

Walker had charged a task force with recommending a tax code overhaul by Aug. 1. But now, with the election less than three weeks away, administration officials concede the much-touted plan won't be released until after the ballots are counted and the next governor is picked.

Both candidates to replace her -- Republican Jon Huntsman Jr. and Democrat Scott Matheson Jr. -- have expressed interest in pursuing reform if elected, but they've been deliberately vague about the prickly issue on the campaign trail.

Walker still vows to produce the plan belatedly, before the end of the year. But no matter how good it is, the question remains whether the post-election timing will render the proposal irrelevant.

"To be honest, it might. But I hope not," says Gary Cornia, a tax expert who serves on the Walker reform team.

In announcing the tax overhaul -- which would be the first in decades -- in December, Walker promised an Aug. 1 delivery date.

"I feel urgent about this. ... In the end, I want action, not another study," she said in a Dec. 5 Capitol news conference. "It's got to be part of the election debate."

Walker lost her bid for re-election in May after failing to win the Republican nomination. After the study deadline came and went, she acknowledged it was being postponed because it was taking more time than expected, but still held out the prospect of a pre-election release.

That possibility now is dead.

"Throwing it out two or three weeks before the election is just not fair to the Juniors," Walker said, referring to the two major gubernatorial candidates.

Though it's not yet complete, Huntsman and Matheson have received a private briefing from Walker's group on problems with the current tax system.

"Whether it's Scott Matheson or whether it's me, I think there are some elements there that are going to have to be driven home," Huntsman said. "From what I've seen, I am not running for cover. In fact, if it's put on the table, I'm here to tell you that the next governor is going to have to expend a lot of political capital in the next year to get it done."

Matheson has said one of the needed reforms is adjusting income-tax brackets for three decades of inflation. He has also praised elimination of the sales tax on food as a "worthy goal," but expressed concern about the loss of hundreds of millions of dollars in revenue.

But Matheson said he is a realist and called tax reform the "art of the possible."

Cornia, a professor at Brigham Young University, acknowledged that without the pressure of a political campaign "nothing will stop" the next governor from shelving the committee's tax-reform package.

"But both candidates have seen the presentation ... and I believe they understand that we have a serious financial challenge in funding education in Utah," said Cornia.

(Copyright 2004 by The Associated Press. All Rights Reserved.)

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