Important tax-study committee seeks advice

OK Montanans, listen up: This is the big one, the tax study to end all tax studies.

And if you believe that, we’d like you to come take a look at this nuclear missile we’re selling.

OUR OPINION EDITORIALS Great Falls Tribune

But seriously, it is a big tax study — ordered by the 2003 Legislature, with an eye toward changing the state’s whole tax structure in the 2005 legislative session.

As it happens, the study committee is looking for help from you — right now.

The panel, established under Senate Bill 461 on the last day of the 2003 session, meets in nine days (Oct. 14) in Helena, and its members want to go to the meeting armed with suggestions and ideas from the public.

Whenever Montanans campaign for elective office or whenever lawmakers go to Helena, reforming the tax system is a political Holy Grail.

The reasons for that are simple: No one likes taxes. And the "grass-is-greener" principle is at work: Any other system of taxation is likely to seem better to the average citizen than what they are paying their hard-earned money for right now.

Furthermore, specific people especially don’t like specific taxes.

For example, many higher income people have a special place in their bile ducts for income taxes, which tend to be more progressive — the percentage of income that goes to taxes increases as income increases.

Similarly, property owners with fixed incomes, or in parts of the state where values are increasing, or both, tend to wish a pox on appraisers and property taxes, which tend to be inequitably assessed and unrelated to ability to pay.

SB461, the bill that set up the study, was prompted by the latest round of property reappraisals, which increased the value of residential property by a statewide average of about 20 percent.

SB461’s primary purpose was to do what the framers of the property tax system in Montana intended: adjust the statewide tax rate and the multiplier for determining taxable value, both to lessen the impact of changes (increases in this case) in market value.

The bill also set up two interim committees: the one discussed above to look at overall tax reform, and another to look more narrowly at "the effects of cyclical reappraisal and methods for mitigating the changes in taxable value" caused by those reappraisals.

Both panels had their organizational meetings last month, and both must submit reports and suggested legislation to the Legislature by Dec. 1, 2004 — a month before the next session is scheduled to begin.

We’ve long advocated tax reform, including charging some kind of a sales tax. We have many reasons for our position, foremost among them our beliefs that:

* The state is overly dependent on property taxes as a primary source of revenue;

* It is not possible for property taxes to be fairly and equitably applied over time and across geographic areas; and

* Montanans leave large amounts of money on the table by paying sales taxes to other states when they visit them, and by not charging out-of-state visitors sales taxes when they visit here.

We also are certain that our position on sales taxes is at odds with that of a majority of Montanans, or at least it has been at odds.

You can be sure, however, that these and more tax topics will be on the table before the Tax Reform Study Committee as it convenes in Helena.

If you care about this issue, or if you ever complain about taxes, now would be a good time to make your voice heard.

Answer the committee’s call for ideas, and be a good citizen.

http://www.greatfallstribune.com/news/stories/20031005/opinion/395314.html