With a laundry list of tax hikes proposed by Congress or Democratic candidates for president, it's understandable why many would view Washington as the biggest threat to taxpayers’ wallets. However, policymakers at the state and local level are just as likely to reach into taxpayers’ pockets as those in Washington, D.C. Take Election Day 2019, which featured nearly 1,000 tax and fiscal ballot measures.
Publicly-accessible data from secretaries of state and county election offices found 954 measures across 19 different states and hundreds of localities, most of which were negative measures that would impact taxpayers and businesses. There were at least 350 measures that would issue a total of $28 billion in bonds (with unspecified increases to property taxes), nine advisory measures on $1.9 billion in annual tax increases, and at least 260 measures to raise at least $4 billion in taxes annually.
While these measures are staggering when combined, it’s what taxpayers don’t know that is truly astonishing. There were at least 249 property tax increases, 68 sales tax increases, 14 physical plant and equipment tax increases, six short-term lodging tax increases, and three income tax increases that do not have any revenue estimates. That means when taxpayers filled in their ballots, they were in the dark on the tax implications of their vote.
Thankfully, taxpayers defeated a number of these measures. Here's a look at some important measures from states across the country:
Colorado: Voters in the Centennial State defeated measures that would have raised taxes by more than $215 million annually and more than a quarter-billion dollars in bond measures. Notably, voters handily defeated Proposition CC, which would have handicapped the state’s Taxpayers Bill of Rights and allowed lawmakers to keep more than $1.7 billion in refunds that will be sent back to taxpayers over the next three years. However, voters did approve many local measures that will raise nearly $100 million in taxes annually and issue $670 million in bonds. Of these, there were a handful of measures that drastically increased taxes on cigarettes, e-cigarettes, and vapor products, and a few measures that allow localities to operate government-run internet utilities.
Texas: By a 3-to-1 margin, voters in the Lone Star State amended the constitution with language to prohibit lawmakers from imposing a tax on income. Texans have doubled down on policy that guarantees that no matter who controls the Governorship or the State Legislature in the future, taxpayers will never have to worry about having the state take your hard-earned money via an income tax. On the local level, voters decided on at least 228 measures, 180 of those would issue up to $19 billion in bonds and 58 measures that would directly increase taxes by an unknown amount. High property taxes remain a top kitchen table issue for many Texans and these measures will certainly cause more headaches for property owners and taxpayers statewide.
California: There weren’t any statewide measures this year, but there were still billions of dollars in tax increases on local ballots. Out of the more than $2.73 billion in annual tax increases that were on the ballot, voters approved $2.63 billion, mainly due to a few billion dollars in sales tax increases in Los Angeles County. Voters in the City of Rancho Palos Verdes rightly defeated a significant minimum wage increase and new worker regulations for hospitality employees. Up north in San Francisco, voters upheld a citywide ban on the sale of vapor and e-cigarettes, which would limit the ability for cigarette smokers to access less harmful substitutes.
Michigan: Much like the Golden State, there were no statewide measures but an abundance of local measures that would be bad for taxpayers. Across more than five dozen counties there were at least 106 measures on the ballot, with 29 measures that would issue up to $2.6 billion in bonds and 77 measures would directly increase taxes by at least $221 million annually. The most significant measure that passed was a local property tax renewal just outside of Detroit in Oakland County, which will raise $450 million over the next decade.
Virginia: The big story that the media will focus on is the new Democratic trifecta in the Commonwealth, but there were more than $1 billion in new bonds that are to be issued. Unsurprising, the majority of these bonds are in Northern Virginia in the DC suburbs and will further increase the cost of living in an already expensive area of the nation.
Elections certainly do have consequences, and for taxpayers and consumers in the aforementioned states and a dozen others, the consequences add up to billions of dollars that they will have to give to their local government each year.
Perhaps the biggest takeaway from this election is the lack of transparency and failure of local governments to provide information to voters. For instance, in Franklin County, Ohio, voters were given a paragraph-long question about extending a property tax with no mention it raises nearly $86 million annually. It’s a similar story for bond measures, where many states don’t divulge how much in interest the taxpayers will have to pay back, the repayment timeline, or how much property taxes will be raised to pay the principal and interest.
Public officials have a responsibility to provide voters with as much information as possible to ensure a well-informed electorate. States should look to Colorado, Idaho, and California as the standard for transparency in election information. With the start of 2020 state legislative sessions just a few months away, state lawmakers across the country can and should make reasonable adjustments to election laws for 2020 ballot measures. If not, localities will continue to pull the wool over the eyes of taxpayers.
Thomas Aiello is a policy and government affairs associate with the National Taxpayers Union, a nonprofit dedicated to advocating for taxpayer interests at all levels of government.
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