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SALT LAKE CITY — It’s official: The Utah Legislature will be tackling tax reform in a special session on Thursday.
Gov. Gary Herbert signed the call Tuesday for the special session, informing the full Legislature it will gavel into session Thursday with tax reform scheduled for 5 p.m.
Anna Lehnardt, spokeswoman for the governor’s office, confirmed to KSL the governor had signed the call shortly after UtahPolicy.com first reported it Tuesday night. KSL previously reported the special session would be coming Thursday.
Later Thursday, the governor’s office issued a news release with the full text of the governor’s letter issuing the call and a statement from Herbert saying he was “tremendously grateful to the Utah Legislature for the time, attention, problem-solving, and effort that they have dedicated to restructuring our tax system over the last 11 months.”
“The decisions we make today will impact our children, grandchildren, and even great-grandchildren,” Herbert said. “I have weighed the policy implications of the current tax bill with great care, and I have concluded that it does take meaningful steps toward stabilizing our tax structure and bringing more equity and fairness to the system. I have also carefully weighed the issue of timing, and whether or not this ought to be accomplished in a special session.
“After much consideration, I have concluded that this bill should be addressed in a special session, so that legislators can carry out their duty of setting base budgets available for allocation during the upcoming general legislative session,” the governor said.
The call for the special session on tax reform comes the day after the Legislature’s Tax Restructuring and Equalization Task Force voted 6-3 to recommend a 199-page draft bill on tax reform to the full Legislature, less than three days after the bill was unveiled to the general public.
For Thursday’s special session, some minor “technical tweaks” are expected to the bill, but nothing major, House Majority Leader Francis Gibson, R-Mapleton, co-chairman of the Tax Restructuring and Equalization Task Force, told KSL on Monday evening.
The bill, which raises taxes on food, gas and some services while lowering income taxes with a net overall tax cut of about $160 million, garnered mixed reaction from the public Monday evening but gained support from many big businesses.
Related:
Utah’s tax task force votes to recommend bill to full Legislature
The state’s tax reform task force voted 6-3 to recommend a draft bill to the full Legislature Monday, less than three days after the bill was unveiled to the general public.Some urged lawmakers to wait to address it in the general session in January, while others said it was too complicated of an issue to tackle while also prioritizing a budget in the general session.
The special session comes as Utah lawmakers attempt to overhaul the state’s tax revenue to address what they call a “structural imbalance” due to lagging sales tax revenues as the economy shifts to be more service-based.
Most Republicans during Monday’s task force meeting supported the plan — though some worried it didn’t go far enough to solve the imbalance by not taxing enough services.
Herbert hinted there could be more to come on tax reform, calling it the “first in a series of steps necessary to create a structure that can support the Utah of the future.”
“A thoroughly balanced and stabilizing approach to reforming our tax code will require continued work,” Herbert said. “I’m grateful to the legislature for their courage in addressing this issue to date, and I strongly encourage them to continue their good work after the special session. The legislature needs to continue broadening the sales tax base and lowering the rate.”
Herbert added tax reform is “never over.”
“In a strong and ever-changing economy like Utah’s, we must constantly assess and modernize to be sure our system is stable, equitable, and fair,” he said. “Utah’s economy is both strong and dynamic, and working together, we can ensure Utah remains the best place to live, to work, and to raise a family.”
Republican legislative leaders have been pushing for a special session ahead of the year’s end, saying Utahns should see less money withheld from their paychecks starting in January if tax reform is finished before the new year. Next year is an election year for all members of the House and half of the Senate.
After much consideration, I have concluded that this bill should be addressed in a special session, so that legislators can carry out their duty of setting base budgets available for allocation during the upcoming general legislative session.
–Gov. Gary Herbert
To help address the imbalance, GOP lawmakers also want to remove the restriction on the Utah Constitution that income taxes can only be used for education — but that isn’t expected to be addressed until the 2020 Legislature convenes in January.
Senate President Stuart Adams, R-Layton, in a statement Tuesday evening expressed his appreciation for the special session call, saying the bill after a “robust process” is ready for the full Legislature.
“A $160 million tax cut for Utah citizens will begin in 2020 while addressing the imbalance in the state budget if the current proposal passes,” Adams said. “We are working to improve Utah’s tax structure today for tomorrow’s future.”
House Speaker Brad Wilson, R-Kaysville, in a series of tweets earlier said this year’s process “builds” on the tax reform process in 2007, when then Rep. Roz McGee, D-Salt Lake City, called it a “proverbial sausage” that was “well-seasoned” with “many good cooks.”
“The proposal being sent to the legislature from the Task Force represents the sausage we’ve worked on over the past year, and as in 2007, it’s well-seasoned and has been prepared by many good cooks,” Wilson said.
