Is Utah budget tallying $500 million surplus?

Or maybe not.

The Utah State Tax Commission, which is officially charged with collecting taxes and comparing them with the current running budget, gave state legislators their first official look at fiscal 2006-07 revenues Wednesday. But in the commission's new revenue report, the four commissioners didn't include any estimates of how collections compare with the budget. They just compared this year's three-month collections with the same collections the first quarter of a year ago.

"I guess it was a mistake," tax commissioner Mark Johnson said, replying to questions about why no surplus revenue estimates were in the report. Johnson oversees the commission's economic forecast unit.

Half of the 29-member Senate and all of the 75-member House face voters Nov. 7. And how to deal with growing state revenues — surpluses in the hundred of millions of dollars — has been an issue in a number of legislative races.

Not placing any current surplus tax estimates in the new TC23 report means that the next report in mid-November will come after the legislative elections.

The new TC23 report shows that tax collections are 12.9 percent over collections for July, August and September 2005. That's an increase of more than $500 million.

Rep. Greg Hughes, R-Draper, is chairman of the House's Conservative Caucus, a group of 30 or so representatives who are looking to trim state government growth. "Even if we only have $300 million plus in surplus revenues this year, that is tremendous growth. We can't sustain it. It makes a whole lot more sense to give some of it back to taxpayers.

"And I promise you will see a very aggressive tax cut package in the 2007 Legislature," Hughes said. One idea, he said, is to exempt from taxation more of the first paychecks Utahns earn under the new flat tax reform package. That would encourage more Utahns, especially low-income Utahns, to pick the flat rate system — which has no deductions — over the current system.

One of the complaints about the new flat rate option is that it gives most tax breaks to wealthier Utahns. But, said Hughes, exempting more of the first-earned income will move people over to the new system faster.

Johnson said after the adjournment of the Revenue and Taxation Interim Study Committee that he hesitates to even guess at how much extra revenue the state is collecting so far this fiscal year. "The first quarter is just so early to see how things are going." Any estimates on revenue surpluses now "are meaningless."

But for years the TC23 report had been issued monthly and showed an estimate of surplus, or deficit, tax collections compared to the budget. Former commission chief economist Doug Macdonald would at times take a little heat for his projections.

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