Midterm Ballot Measures Every Taxpayer Needs To Know About

Lee Schalk State Affairs Manager, National Taxpayers Union
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With Election Day just around the corner, you’ve undoubtedly been inundated with ads, and news stories as heated political races garner a great deal of attention, but what about ballot measures?

This year, voters will directly decide the fate of proposals that could result in billions of dollars in higher taxes and new spending. National Taxpayers Union’s (NTU’s) annual compilation and analysis of statewide and local measures highlights those that would most significantly affect the wallets of Americans – and a few that might make you scratch your head.

Soda taxes are back

After watching his beloved soda tax hike measures fizzle in 2012 and 2013, former New York City Mayor Michael Bloomberg is hoping his idea will fare better with the overwhelmingly liberal voters in Berkeley and San Francisco, California.

One of the chief problems with these measures is that they’re regressive, as they would hit local businesses and lower-income residents the hardest. Measure D in Berkeley would place a 1-cent-per-ounce tax on “sugary” drinks, while San Francisco voters will decide on Proposition E’s 2-cents-per-ounce hike.

Tax dollars go wild

Rhode Islanders will decide on Question 7, which would increase state debt by $53 million – part of which would go straight to the Roger Williams Park Zoo. In Fresno, California, Measure Z would renew a ten-year sales tax hike to pay for Fresno Chaffee Zoo upgrades, despite the city already collecting $102 million during that decade.

The Golden State could continue that tax-and-spend trend in Fortuna, where Measure V would increase the sales tax by 1 percent to pay for the rodeo, and a car show featuring a burn-out contest.

Protections from the income tax

Last November, the most significant ballot proposal was a $2 billion income tax hike that was rejected by 64 percent of voters in Colorado. Election Day 2014 also features significant income tax measures, but this year the tax hike script is flipped.

In Georgia, Amendment A would prohibit state lawmakers from increasing the income tax, while Amendment 3 in Tennessee (0 percent income tax rate) would ban such taxes in the state constitution.

Passing protections for taxpayers in places like Georgia and Tennessee could place pressure on lawmakers in other states to lower income taxes.

New York and California ponder even more debt.

Once again, ballot measures in the Empire State threaten fiscal responsibility. One monster measure, Proposal 3, would increase New York’s debt by $2 billion to update technology in public schools. Before casting a vote, New York taxpayers should take note of the latest State Budget Solutions debt report, which found the state to be underwater to the tune of $387 billion.

Not to be outdone, California’s Proposition 1 seeks permission from voters to add $7.12 billion to the state tab to fund water infrastructure projects – despite the fact the Golden State recently hiked taxes to 30 percent on high earners. The same State Budget Solutions report lists nearly $778 billion in debt for California – it’s no surprise that California has one of the nation’s lowest bond credit ratings.

A gas tax revolt in Massachusetts?

It was home to the Boston Tea Party, and this year could see another tax revolt — albeit a much smaller one – in Massachusetts. Last year, Democrats passed a 3-cents-per-gallon gas tax hike and indexed it to inflation, meaning it will continue to increase every single year. Question 1 would eliminate indexing of the gas tax, which currently sits at 26.5 cents per gallon.

Nevadans will decide on Texas-sized tax.

Question 3 in Nevada is a big deal. Will Nevadans accept a 2 percent margins tax on Nevada businesses to fund public schools?

This isn’t a corporate income tax, it’s worse: a margins tax means that the government gets a cut of overall revenue not overall profit. Texas has a similar tax policy in place that many conservatives have wanted to abolish for years.

If passed in Nevada, Question 3 would stifle job creation and hurt Nevada businesses while doing little to improve education. Taxpayers and job seekers should fear the spread of this type of tax.

For taxpayers in these and other ballot measure states, billions of dollars are directly on the line. For those in other states, these votes will alter policy in the laboratory of democracy, offering a preview of the fiscal concoctions politicians may soon offer to them. Either way, anyone who wants to protect their pocketbook from taxes and spending should pay close attention to America’s ballot measures on November 4.