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SALT LAKE CITY — Governor Gary Herbert says the Utah road and general funds are running out of money. So he wants the legislature to consider raising the gas tax.
Currently, the Legislature is discussing a small income tax cut, this would take money away from the education fund. Typically, Utah takes in 20-million dollars more in income tax than is budgeted for education use.
But, Herbert says “Why give a tax cut now? Only [to] then need to raise some tax in the coming tax reform and have nothing to offset that tax hike?
He goes on to say taking money away from education while doing nothing on tax reform, doesn’t make any sense.
Herbert also stresses the Utah Education Association has to agree on with any tax reform which affects where income taxes are directed. Utah’s constitutions specifically states 100% of all income taxes are to fund education.
That’s been a big stumbling block when tax reform comes up. Utah’s legislators and voters will need to get on the same page to change to the constitution.
So, Utah lawmakers are left with property, food and gas taxes to fund everything else in the Beehive State. Herbert says the gas on tax was raised a few years ago, but was NOT fully adjusted for inflation for the 20-years before that. And now the state’s road fund is dwindling.
Meanwhile, Rep. Tim Quinn (R-Heber) has proposed HB260 which would increase the dependent exemption on taxes. That exemption was eliminated on the Federal level by President Trump in the 2017 tax overhaul.
Quinn’s bill would eliminate $51-million in income tax revenue if passed.
And Rep. Travis Seegmiller (R-St. George) has HB427 which drops both the individual and corporate income tax rates. If that bill is approved, another 80-million tax dollars will be off the table.
Herbert says “It might be best to save all the income tax surpluses now, and then deal with a tax cut in the 2021 Legislature along with a renewed effort at tax reform.”