Each morning, I hear several killdeer rehearsing their repertoire along 1200 West. These ground-nesting birds fascinate me with their effective use of injury-feigning display to distract would-be maliciousness from their nests. My first encounter with a killdeer sucked me in – I truly believed that mama had a broken wing and that I needed to intervene. When I realized she wasn’t injured and Googled to understand her motives, my concerned turned to respect. This was a visual display of Darwinism.
So, what does this have to do with tax reform?
Firstly, it’s essential to understand the situation to develop an appropriate response. Had I attempted to care for the killdeer, I might have done more harm. Similarly, jumping into tax reform without understanding the situation may, too, result in ineffective solutions and unintended consequences.
Secondly, like the impressive diversion created by the feigned injury, tax reform is an area of controversy and complexity through which agendas and lobbying are ever-present. If we respect one another and our shared goals in society, we receive the killdeer’s message and step away from the vicinity of the nest. If not, we deviously revel in our awareness that her behaviors actually result in the nest temporary abandonment – an ideal time to strike.
Thirdly, tax reform itself – done poorly – may serve a Darwinian role to the economy. Likewise, so, too, may the lack of tax reform.
Regardless of whether you buy the analogy, understanding the situation, acknowledging its controversy and complexity, and being ever-diligent in using data to model effective outcomes prior to changing law are three critical aspects of this process.
Now, for the specifics.
Utah’s tax code is extremely outdated and, although we’re an economically sound state and recognized for our effective financial management, the money isn’t flowing into or out of the right buckets. For example, current law (written in the 1980s) places a large emphasis on sales of goods. However, consumers in the 2010s purchase more services than goods. As such, we see insufficient revenue in our general fund. However, we have an income surplus. Fundamentally, the “robbing Peter to pay Paul” scenario applies in Utah.
Other factors beyond goods and services models that influence our current dilemma include increasing demands on the general fund that accompany increases in population (e.g., air quality, Medicaid, homelessness) and our own choices to reduce food taxes and increase exemptions and earmarks.
An interesting point made by Commissioner John Valentine at the enlightening Bold Ideas on Tax Reform Workshop that I attended this week (through the Public Policy Committee of the Utah Valley Chamber of Commerce) was regarding the impact of technology on tax code. Technology has changed the delivery of goods to the extent that they’ve become lesser-taxable services. Valentine’s example presented the evolution of movies – purchasing a ticket or downloading a movie results in sales tax; however, streaming the same movie results in no sales tax.
In Mapleton, we understand an urgency to diversify our tax base. This is no different than the wisdom in an individual diversifying an investment portfolio. In the City’s case, this includes filling designated commercial zones (primarily along Highway 89). In my meetings with community members, there has been some concern expressed that we’re too small for retail and services (such as medical offices) do not contribute as significantly. Would a tax reform that broadens the tax base without increasing overall taxes be a potential help for our City’s portfolio? (Yep.)
At the Workshop, potential solutions currently being modeled and some new ideas were discussed, some of which would require a State Constitution modification. Among these conversations included: raising taxes, eliminating exemptions and earmarks, increasing sales tax on groceries and/or services, changing the allocations for income and/or property taxes, and reducing non-taxable federal lands.
One thing I’ve repeatedly said is that win or lose, the process of running for office has been one of the most rewarding experiences of my life (and I’m just getting started). The knowledge I’ve gained and people I’ve met are irreplaceable. However, one thing has become abundantly clear and that is this: all politics are local politics. If you don’t think tax reform will impact our community or you personally, consider the examples I’ve noted here – it gets a bit personal, right?
If you’re interested in getting involved, the State Tax Commission is calling for feedback and ideas. Visit the website at https://tax.utah.gov/ for information on all-things-tax, reach out to them at https://tax.utah.gov/contact, or reach out directly to Commissioner Valentine at firstname.lastname@example.org.