Jay Evensen
  • Front Page
  • Opinions
  • Second Thoughts
  • Portfolio
  • Awards
  • About

Who are the losers in Utah's proposed tax reform bill?

3/6/2019

0 Comments

 
To Jim Ferrin, tax reform is more than just an abstract concept. If Utah lawmakers succeed in making a law out of the roughly 260-page bill that became public last Wednesday and zipped through a House committee on Thursday, he may have a decision to make.

Try to deal with the cost and hassle of collecting sales taxes from his many clients spread throughout Utah, move somewhere else or find a different line of work.
​

Utah lawmakers are on the verge of enacting sweeping tax reform with less than two weeks to go in their annual 45-day session, which ends March 14. The bill, HB441, contains 8,030 lines of type. It is by no means the only thing to be considered during the final days. How many lawmakers have read it?
A former lawmaker himself (he lost re-election in 2006 after serving three terms), Ferrin is an investment adviser and retirement planner. He has separate contracts with each client and is licensed with a company in Atlanta that would need to be persuaded to begin collecting the Utah sales tax.
Legislative leaders are touting the plan as a tax cut because, eventually, it would lower the state’s portion of the sales tax from 4.7 percent to 3.1 percent. But counties and municipalities add their own sales tax rates on top of this. Ferrin, and others who provide similar services, would go from charging zero sales tax to having to collect a different rate for each client, depending on where that person lives. He calls it, “an accounting nightmare.”
When Kristen Cox, executive director of the Governor's Office of Management and Budget, told last week’s committee hearing she could think of no obvious winners or losers in this plan, Ferrin was quick to react. Are you looking for a loser? “That’s me,” he said.
Others claim that label, as well. This reform plan would tax most health care services, child care, private lessons, lawn care services, barber shops, tuition, health insurance premiums, architectural services, plumbers, tax preparers and anyone else not specifically exempted. It would place a transaction tax on real estate purchases. It also would slightly reduce the state income tax rate.
The American Society of Travel Advisors issued a statement Monday saying the bill would cost the average Utah travel agency $13,000 a year, “threatening layoffs at a time of razor-thin profit margins.”
Of course, those kinds of reactions are everyday fare at any Capitol. Are the claims really true? Would people leave the state and ply their trades from Wyoming or Nevada, instead? Would the bill be a drag on the economy?
There is no way to know for sure about this right now, although it’s safe to say every new tax law triggers unintended consequences.
What may be said with certainty, however, is that precious little time remains in this legislative session, and HB441 is massive.
The sponsor, Rep. Tim Quinn, R-Heber City, bristled during the hearing at the notion that the bill is being rushed. Legislative leaders have reacted similarly, saying the idea of taxing services and lowering the overall rate has been discussed for years. Lawmakers have long worried that sales tax revenues are drying up because the economy is becoming more service-oriented, with smartphones and other devices replacing many products people used to purchase.
But discussing something in the abstract is one thing. Going over the details of an enormous, newly released bill is another. That ought to be true for most big decisions. A family may spend years discussing the desire to buy a home, for example, but it would be foolish not to take time to deliberately study a house and the details of a possible transaction before making a purchase.
That ought to be even more important in a representative republic.
Last week’s House committee hearing, held barely a day after the bill was made public, included only about 45 minutes for public discussion, most of which was dominated by business owners.
As for the general public, backers of the bill say the average family would save $664 a year.
Maybe, or maybe not. And maybe the average Utah family has no idea what’s happening. That’s what Ferrin believes.
“I bet you couldn’t go out on the street and interview 1,000 people and find three who know about this,” he told me.
If that’s true, they may soon find out the hard way.
0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    RSS Feed

    Search this site


    Like what you read here?

      Please subscribe below, and we'll let you know when there is a new opinion.

    Enter your email address:

    Delivered by FeedBurner

    Picture

    The author

    Jay Evensen is the Senior Editorial Columnist of the Deseret News. He has nearly 40 years experience as a reporter, editor and editorial writer in Oklahoma, New York City, Las Vegas and Salt Lake City. He also has been an adjunct journalism professor at Brigham Young and Weber State universities.

    Archives

    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012
    November 2012
    October 2012
    September 2012
    August 2012
    July 2012
    June 2012

    Categories

    All
    Campaign 2012
    Congress
    Crime
    Culture
    Iran
    Oil And Gas
    Poverty
    Steroids
    Taxes
    Utah
    Washington
    World Events
    World Events

    Links

    Deseret News
    Newslink
    Marianne Evensen's blog

Powered by Create your own unique website with customizable templates.