ARTICLE

Was Bredesen Leaving the Door Open On a State Income Tax?

October 1, 2005 10:20PM

By Troy Senik The Tennessee Center for Policy Research’s Troy Senik encourages Gov. Bredesen to take a stronger stand against an income tax in the Tennessean. Gov. Phil Bredesen, apparently anxious to give voters across the state a heaping spoonful of whatever he thinks they want to hear, told the Nashville Rotary Club Monday, “I’m not interested in having an income tax in a second term. I don’t think we need it. This past rolling 12 months our … revenues have grown by 6%. I guess I say, ‘How much do you want?’ You know, inflation is 2.7% and our state revenues have grown by 6%. I think that, you know, that we’ve been successful in trimming some things out, and we’re going to continue to work on a number of other kinds of issues.” All well and good, right? Maybe not. Tennesseans only have to travel back as far as 1999 to find former Gov. Don Sundquist, early in his second term, stating that “all an income tax does is raise the tax burden on Tennesseans and create a way to finance the easy and endless expansion of government. Tennessee does not need a state income tax.” Later that very year, Sundquist himself proposed to raise the tax burden on Tennesseans and create a way to finance “the easy and endless expansion of government.” Of course, a previous governor’s broken promises of fiscal responsibility don’t necessarily mean that Bredesen is destined to pull the same bait-and-switch, but it certainly gives reason for pause. Tennesseans should note Bredesen’s careful selection of language in his Rotary Club speech. For years, taxpayers have watched helplessly as their hard-earned wages have evaporated under the watch of politicians who have used much stronger anti-tax language than Bredesen’s “I’m not interested” and “I don’t think” doublespeak. If the governor’s words aren’t enough to cause concern, his actions — or lack thereof — certainly should. Consider this: Bredesen refused to sign an anti-income tax pledge sponsored by the Tennessee Tax Revolt, referring to the pledge as “pure political posturing,” yet stating: “I am against an income tax, and frankly, I think that over the last three years we have shown that we don’t need one.” The last three governors of Tennessee have all at least flirted with the idea of a statewide income tax in their second term, and nothing indicates that a second Bredesen term would prove any different. The prospects are potentially gloomy for taxpayers since Bredesen appears to stand firm on his political principles right until the moment he has to sign on the dotted line. If the governor truly doesn’t want an income tax and is not, as many fear, simply sitting on an income tax proposal until the first hiccup in the state economy, he needs only to take two simple steps. First, Bredesen must substantiate his anti-income tax stance by signing the Tennessee Tax Revolt pledge or by formally and unequivocally declaring that he will veto any attempt by the General Assembly to pass an income tax. Second, it is essential that Bredesen safeguard Tennessee’s taxpayers and the state economy from the type of economically poisonous spending sprees currently occurring at the federal level under President Bush. The best way to control spending and encourage economic growth on the state level is through a Taxpayer Bill of Rights. A Tennessee Taxpayer Bill of Rights limits state spending to the level of the previous year, with a modest increase to reflect the state’s economic growth. Revenue surpluses would then go into a rainy day fund to ensure that tax increases wouldn’t be needed to fund the state budget in lean years. After fully funding the rainy day account, legislators would refund taxpayers overpayment by lowering the gas tax, sales tax or grocery tax. By making his opposition to the income tax firm and endorsing legislation to ensure that Tennessee avoids the fiscal crises of the past, Bredesen can ensure that ours will be an income tax-free state for years to come. As Andrew Jackson said in 1836, “It is practicing upon the great principle … of our government of rendering to the public the greatest good possible with the least possible taxation to the people.” Gov. Bredesen would do well to heed Jackson’s wise advice.