From Deseret News archives:

Deductions are likely in tax plan

Huntsman reportedly has adjusted reform package

Published: Tuesday, Oct. 11, 2005 2:31 p.m. MDT
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Huntsman has said his focus is on lowering the state income tax rate to help boost economic development. He has said he'll give up trying to do away with the state's corporate income tax, after failing to win support from lawmakers last session.

He's also spoken in favor of some kind of income tax credit for sales taxes paid on basic food items — which would give a tax break to lower-income Utahns as well.

The "flatter, simpler and fairer tax policy" he's described will also likely include at least some chance for taxpayers to deduct the charitable contributions they make, as well as possibly mortgage interest and other deductions taken on federal returns.

The Deseret Morning News has confirmed from several sources that the governor — whose late grandfather Elder David B. Haight was a member of the LDS Church's ruling Quorum of the Twelve — has met with leaders of The Church of Jesus Christ of Latter-day Saints several times on state income tax reform.

Church leaders have issued several statements this spring and summer, asking that any income tax reform keep the deduction for charitable giving.

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At one point, the News was told, Huntsman believed that church leaders might be willing to modify their stand on a deduction for charitable giving — as several studies show that states with either no state income taxes or where there is no deduction for charitable giving on state returns have comparable levels of charitable giving as states that give the deductions. In other words, income tax policy does not seem to affect donations to churches, foundations, the arts and so on.

But several weeks ago, an attorney representing the LDS Church stated in testimony before the task force that the deduction should remain.

Sen. Curt Bramble, R-Provo, the co-chairman of the task force, said Tuesday he had received no sneak peek at the governor's plan.

"We're looking forward to reviewing the governor's proposal and considering it," Bramble said. "I anticipate the governor's proposal will recognize the concern over charitable contributions and the impact of tax policy on the various groups of taxpayers, from low income to high income. We'll listen with interest."

Task force members have scheduled public hearings around the state later this month. And the goal is to have a specific recommendation on various tax reform alternatives to present at those meetings. However, it's possible that the 15-member task force won't be able to agree on single issues — like income tax reform — and various plans will be put before citizens.

Huntsman himself has said he will travel the state listening to residents' views on tax reform — income tax is only one part of the whole picture — while trying to sell his ideas.

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