Any way you look back on it, 2013 was an eventful year. From Edward Snowden revealing classified information on the NSA, to Miley Cyrus scorching our retinas during the Video Music Awards, to Washington’s own football team crashing and burning on the gridiron, there was never a dull moment. The same was true for taxpayers, who in some states and localities saw pro-growth reforms enacted, while others experienced harmful tax hikes and new onerous regulations. Here are the top five highlights and lowlights for taxpayers from the past year.
1. North Carolina’s historic tax reform
This past summer, National Taxpayers Union (NTU) and many fiscal groups applauded the North Carolina General Assembly and Governor for enacting the most significant tax reform package of 2013. The “Tax Simplification and Reduction Act” replaced North Carolina’s three-tiered personal income tax with a lower flat rate, reduced the corporate income tax, eliminated the death tax (Indiana also nixed its inheritance tax this year), and placed a cap on the state gas tax. Families and businesses across the Tar Heel State are certainly looking forward to these lower rates in the new year.
2. Colorado Amendment 66 defeat
The pundits kept claiming they were becoming increasingly moderate in their political outlook, taxpayers in “purple” Colorado nonetheless emphatically rejected the $1 billion income tax hike that appeared on the Centennial State’s November 5th ballot. Backers of Amendment 66 were left scratching their heads after spending roughly $10 million (opponents spent a measly $30,000), only to see the measure get thrashed at the polls by a 2 to 1 margin.
3. Balanced Budget Amendment (BBA) convention application passed in Ohio
With strong grassroots pressure and bipartisan support, the Ohio Legislature passed a Balanced Budget Amendment (BBA) convention application, increasing the number of states with BBA resolutions from 19 to 20 and that much closer to the 34 states required to hold an assembly that would draft and propose a federal constitutional safeguard against runaway deficit spending. Less than a month later, state lawmakers from thirty-two states met at George Washington’s estate for the Mount Vernon Assembly to strategize about a possible convention of the states to amend the Constitution to include a BBA.
4. Eighteen states cut taxes
The American Legislative Exchange Council recently released its 2013 State Tax Cut Roundup, which found eighteen states that cut taxes in the past year. According to the report, “Nearly one quarter of the 25 tax cuts were to the personal income tax, followed by reductions to various state specific taxes and to the corporate income tax.” States that successfully cut personal income taxes in 2013 include Arkansas, Indiana, Iowa, Kansas, North Carolina, Oklahoma, Ohio, and Wisconsin. (There was one discouraging note: Oklahoma’s cut was just deemed unconstitutional under state law by the Oklahoma Supreme Court.)
5. Soda “sin” taxes rejected, again
The Amendment 66 defeat wasn’t the only good news out of Colorado on November 5. In Telluride, 68 percent of voters rejected a regressive penny-per-ounce soda tax, leaving backers grasping at straws to explain their defeat (how about the fact that voters of all political stripes tend to hate Nanny-State tax schemes?). In November 2012, similar measures were shot down in Richmond and El Monte, California. All three of these cities gave President Obama strong support in his reelection, yet sent the soda tax hikers packing. But rest assured, they’ll be back in 2014 with more penny-per-ounce ballot measures.