Commission says revenue-neutral, despite public assumption
NASHVILLE — Members of a committee studying Tennessee’s tax structure say that it’s not their job to raise taxes, responding to critics who say they don’t want a state income tax to even be considered as an option.
Former Gov. Don Sundquist, Lt. Gov. and Senate Speaker John Wilder, and House Speaker Jimmy Naifeh selected the people on the commission. Opponents of an income tax have criticized the makeup, saying it’s “stacked” in favor of such a tax.
Two of those opponents — radio talk show host Steve Gill and Tennessee Conservative Union chairman Lloyd Daugherty — were invited to speak before the commission Thursday.
“There’s no person seated at this table who actively spoke out against an income tax,” Gill said.
He said with no “anti-tax representation” on the commission, Tennesseans are led to believe that an income tax is a strong possibility.
“Smoke from the battlefield still floats around from the Sundquist years,” said Daugherty, referring to the protests and horn-honking around the Capitol when the state unsuccessfully tried to pass an income tax two years ago.
Member and former Democratic Sen. Bob Rochelle, however, said that’s not the case.
“I think this group has all along listened to the facts of anyone who wanted to bring facts before them, and made a commitment to make their decision based on the facts that were heard,” said Rochelle, who advocated an income tax while he was in the Legislature.
He said the Legislature decides how much money will be raised, and an alternative tax structure would raise that same amount, perhaps just in a different way.
The commission has asked for presentations on an income tax, a statewide property tax and a vehicle tax.
Last month, they were presented a model of an income tax from the state Revenue Department that contained graduated tax rates from 3.5 percent to 6 percent and an $18,000 exemption for a single taxpayer.
Seventy percent of Tennessee taxpayers would pay less or equal state taxes under that model, which removed the sales tax from food and cut the overall rate to 5.75 percent. The current sales tax is 7 percent with local levies that push it as high as 9.75 in many cities.
Other income tax models reviewed by the panel included ones based on flat taxes, one with lower exemptions and ones that kept a sales tax on food.
When asked by members what tax structure they’d like to see, both Gill and Daugherty said they liked the sales tax.
“A sales tax makes a lot of sense,” Gill said. “It should be flat, open and as clear as possible.”
Phil Schoggen, an 81-year-old former psychology chair at Vanderbilt University, was one of the few citizens in attendance Thursday. He said he thinks an income tax is “fairer.”
“It takes money from those who have a lot, and doesn’t take from those struggling for the bear necessities in life,” Schoggen said. “We change a sales tax on baby food, but not on horse feed.”
————
On the Net:
Tax Structure Study Commission, www.state.tn.us/taxstructurestudycommission