Action Report: Tax Reform Update

December 18th, 2019|Issue Update|0 Comments

Last week the state legislature passed a sweeping tax reform bill during a special session called by the governor. The bill created some major changes on what gets taxed as well as created a 155 million dollar tax cut. After a failed bill during the last legislative session, the development of a task force to study the issue, numerous town halls and countless hours of meetings, a 200 page piece of legislation was produced. While it is difficult to sum up a change of this magnitude, we want to touch upon a couple of key points. First, the good news:

A few good things to come out of the tax bill aside from the tax reduction and pre-bates for some families, include:

  • 6 million dollars to fund a state Earned Income Tax Credit, which provides a credit to families who experience intergenerational poverty.
  • A removal of the sales tax on menstrual products

There is a lot of opposition to the bill for a variety of reasons and from a variety of different groups. Some people oppose any type of tax increase even with an accompanying tax cut. Some people specifically oppose a tax on food even with the accompanying tax “pre-bate” that was included in the bill which will provide low income families with dependents up to $200 in addition to a tax credit for low income families. Some people feel very strongly that the legislature did not heed the will of the people, particularly after an analysis of all comments made at the town hall meetings showed that the attendees opposed the plan 9 to 1. Some people feel that the decision was made very quickly, without considering all the perspectives. Some fear that a reduction in income tax going towards education will result in less education spending than before.

Utah law mandates that in order for a bill to take effect immediately it must pass with a two thirds majority vote. Because the bill failed to reach that threshold, with a total vote count of 43 to 27 in the house, it is subject to a citizen’s referendum. This means that if someone were to collect enough signatures within a certain period of time, the citizens could repeal the law. This is a hefty task, requiring the collection of more than 115,000 signatures in a little more than a month from counties all over the state. As of Tuesday, two different groups have filed referendums.

Are you upset about an aspect or several of the tax bill? You aren’t alone. As of Tuesday, two different referendums have been filed with the Utah Elections Office. One of the groups is being led by a former legislator and has a Facebook group with close to 8,000 people volunteering to go out in their neighborhoods to collect signatures.

What can you do?

Join the Facebook group, Utah 2019 Tax Referendum, to keep up on news and developments with the referendum efforts.

Follow along during legislative session for any additional tweaks to the bill.

Learn about the Utah tax structure here: https://tax.utah.gov/econstats/history

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