I smell a rat | Arkansas Blog

I smell a rat

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I'd been wondering what's been taking Attorney General Dustin McDaniel so long about getting around to issuing a revised opinion on Sheffield Nelson's proposed initiated act to raise the gas severance tax to 7 percent of market value. McDaniel had found a fewsmall problems. Nelson speedily addressed them. Most of the measure had been studied before by McDaniel's office. It seems like the attorney general could whip something out on the revise.

Then today comes news that McDaniel has all but issued an invitation for somebody -- anybody -- to request an attorney general's opinion on whether the severance tax could be increased without a three-fourths vote of the legislature, as has generally been presumed. And it sounds like he's just itching to say that it can -- to a very limited degree.

The current non-existent severance tax was adopted in 1957. But in 1934, when the Constitutional amendment was passed that set a three-fourths vote requirement for new taxes, the severance tax was at 2.5 percent of market value. McDaniel indicates the legislature might be able to restore that 2.5 percent tax by a simple majority vote.

Wouldn't that be swell?

Given the rising sentiment -- not to mention simple justice and common sense -- behind moving the severance tax to a rate pegged to the region (Oklahoma charges 7 percent), the gas industry would jump at an opportunity to settle for a rate 60 percent lower. And McDaniel seems anxious to help them along, not to mention Gov. Mike Beebe, who's been urging a legislative settlement. Who knows, maybe Beebe even urged a little slow-walking by the attorney general's office to see if this little deal could get struck before the initiative campaign kicked off

Give this option to the legislature now and we'd not only be stuck with far less than half a loaf in taxes, you can bet whatever passed would be loaded with other little exemptions, giveaways and hidey holes for the gas industry. Plus, somebody might even successfully sue over even that tiny increase.

Now, more than ever, I think an initiative is the way to go, striking while interest is high and plenty of highway interests are ready to get the job done for the construction money a new tax would provide. Dustin McDaniel's entry into this arena with his friendly little suggestion causes me nothing but suspicion.


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