Huntsman ready to revisit sales tax on services
Huntsman had recently revived the idea of taxing services the same way as goods as a way of raising money to cover the cost of taking the rest of the state's share of sales tax off food.
But now he's supporting raising the tax on a pack of cigarettes from 70 cents to $3. The governor said that would raise more than enough money to eliminate the remaining 1.75 percent food tax.
Some lawmakers said the governor changed his mind about calling for a sales tax on services after realizing there was little interest in the controversial proposal which has been rejected before by lawmakers after being raised in 2004 by former Gov. Olene Walker.
"I know he got a lot of pushback on that," said Sen. Wayne Niederhauser, R-Sandy, especially from the professionals who would be taxed. Niederhauser, an accountant, is part of a Tax Review Commission studying taxing services.
"It may be good long-term policy, but it's politically challenging," Niederhauser said. Most difficult might be taxing medical services, he said, considering the pressure to deal with health-care costs.
He said the sales tax on services would be packaged with a tax decrease, possibly an overall reduction in the sales tax rate. But will that be enough to win over lawmakers?
"It depends on what the offsetting tax decreases are. I don't know," the governor said. "We just have to recognize the reality of our economy longer-term."
He said taxing services, which is viewed as a way to stabilize state revenues, is just the next step in tax reform. The state has already, for example, lowered income tax rates and moved to a flatter system.
What's important to Huntsman now is getting the rest of the state's share of sales tax off food. He said the $2.30-per-pack increase in cigarette taxes will also raise money for health care and cancer education, something his family has long supported through the Huntsman Cancer Institute.
"I see that as an appropriate trade-off from a tax policy standpoint," the governor said. "The food tax hits every single citizen, particularly the most vulnerable. I can think of no better way, when the economy is flat, to help those most in need than to give them some assistance in the checkout line."
While the House has long supported taking the sales tax off food, the Senate has been reluctant. Senate President Michael Waddoups, R-Taylorsville, said they'll take some convincing.
Niederhauser said the cigarette tax may be a better choice for raising the funds needed to pay for taking the sales tax off food. "I think it probably has legs," Niederhauser said, "being a 'sin tax.' Of course, in Utah."
E-mail: lisa@desnews.com
Recent comments
Who would be paying for the taxes on services, certainly not the...
kmac | Jan. 26, 2009 at 4:32 p.m.
Could not have said it better my self...
"A sales tax on
services...
Joe in Park City | Jan. 22, 2009 at 4:54 p.m.
I like Jon Huntsman Sr.
I don't like Jonny Jr. Or, as I like
to...
Jonathan Nielsen | Jan. 22, 2009 at 1:36 p.m.
- Chiefs win 7th straight in Oakland 5:57 p.m.
- Motor sports: Hendrick denies deal 5:46 p.m.
- Seniors steady Texas in 89-42 win 5:41 p.m.
- Transactions 5:40 p.m.
- Hurricanes snap 14-game skid 5:31 p.m.
- Tar Heels beat Valparaiso, 88-77 5:28 p.m.
- Mountaineers outlast Loyola, Md. 5:27 p.m.
- Wie gets 1st LPGA Tour win 5:25 p.m.
- Surprising wisdom from children 5:13 p.m.
- Favre to Rice helps Vikings win 4:19 p.m.
- SLC council OKs gay rights policies
361 - BYU happy to escape with victory
224 - TCU creams U.
217 - Editorial: Mormons and gay rights
201 - Will state consider gay rights law?
148 - Letters: Strange breed in Utah
133 - Can BYU root for (ick) Utah Utes?
130 - Utes remain silent about BCS
120 - RSL heads to MLS title game
117 - Celtics crush Jazz
104
Sears is holding a special VIP night Sunday, Nov. 15, in stores and online.
How do you handle kids and contests? Our oldest daughter, 7, is of the...
to BYU. The talk before the season was that BYU had a shot, if they went...
Who says that third parties don't have a chance. Seems to me that every two...
1. Utah, is that the same red as the 80's, no. 2. BYU has the most fickle...
You guys have been our kids for 4 years and some of you more...what a bunch...
I couldn't agree more the game has been played and the best team on the night...
The funny part about all the BYU fans and the ranking stuff. The only ranking...
Clearly winning capped it, but it was great having Gameday and the Utes in...
Get rid of the incumbents!Get people in office that take their...
Way to go! Knock off the defending champions already twice!
I am a frog fan for forty years but the Utes showed class when a TCU player...

