Good report from Roby Brock on the House Revenue and Tax committee meeting this morning.
The committee approved a bill to exempt utilities used by certain agricultural businesses from the sales and use tax. This would reduce state revenues by around $10 million a year according to the Department of Finance and Administration. Gov. Mike Beebe opposes the cut.
Meanwhile, the committee also approved a bill to raise the timberland tax from 15 cents to 20 cents per acre. This would bring in an additional $700,000 for Forestry Commission.
Wait a second, you say! A Republican-controlled committee okayed a tax increase?
No worries. Their paymasters at Grover Norquist's Americans for Tax Reform sent a letter stating that passing the two bills in conjunction would not run afoul of the Taxpayer Protection Pledge that many Republican lawmakers have signed.
From Brock's report, the letter from Norquist stated: "[I]if HB 1039 is passed first, followed by SB 5, then Americans for Tax Reform will be certain to inform Arkansas taxpayers that your vote in favor of SB 5 is NOT in conflict with the Taxpayer Protection Pledge because the effect would be a net tax cut.”
This is hilarious partly because holy moly, Norquist is down in the local weeds on some piddly bills!
More broadly, if you want to say that two bills in conjunction that offer a net tax cut negates the fact that one of them is a tax raise...sure. Reasonable enough. But it's stunning that we don't know whether or not that's the way to look at it until we get a ruling from Norquist. At this point the Tax Pledge isn't an ideology, it's a religion. So naturally, we need rulings from Norquist, blessed with papal infallibility, from time to time.