Friday, May 12, 2017

TOP STORY >> Officials to study taxation

Leader senior staff writer

Neither Senate President Pro Tempore Jonathan Dismang (R-Beebe) nor Rep. Bob Johnson (D-Jacksonville) say they have a preconceived idea what a reimagined tax code would look like, but both say there are issues they want to explore when the Tax Reform and Relief Legislative Task Force begins meeting.

The General Assembly approved a $50 million tax cut the past session and called for creation of the task force.

The two are among 16 state senators and representatives on the task force, charged with studying the tax code top to bottom and to make recommendations for revisions when the 92 General Assembly convenes in January 2019, according to Dismang.

House Speaker Jeremy Gillam (R-Judsonia) will call the first meeting within 30 days of adjournment and taskforce members will elect officers and take it from there, Dismang said.

“We have no strong guidelines,” Dismang said. “We’ll modernize what we have now, look at exemptions. We’ll make sure there is a stable revenue stream for the state and proper tax relief for working Arkansans.”

“One of my personal goals would be to get rid of personal property tax,” said Johnson.

“It’s mostly sales and income tax we have the authority over. There are some inequities, and I want to make things more uniform like they are in North Carolina, Kansas and Louisiana,” he said.

He said he’d make a fact-finding trip to North Carolina.

Johnson said he’d like to consider channeling taxes from sales of auto-related items—batteries, tires, wipers—to state highway funds.

“You go buy something from Auto Zone, (the revenue doesn’t) go to roads, it goes to the general fund.”

Directing auto-related funds to state highways among the recommendations of two different highway-funding blue-ribbon commissions in the past several years.

Johnson said the state needed to devise a system to promote economic growth, which should create even more revenue.

“I’m not a big fan of trickle down,” Johnson said, “but let’s reduce barriers to growing business.”

“I’m not interested in the rich getting richer, I want more jobs, better paying jobs,” Johnson said. “Do we need to adjust the tax charts?”

Johnson, the only practicing certified public accountant in the legislature, says he doesn’t want changes to “complicate it to where people can’t do their taxes.

“I’ve encouraged highway funding,” Dismang said. “We’ve looked at taxation in silos, but not in totality. I’d like for (the task force) to look at the overall picture and stop looking in segments.

“Everything is on the table,” he said. “I don’t have any preconceived notions.” He said the review would be data driven.

Dismang said he’d like legislators to reduce revenue and focus on a long-term reserve.

He said funds for the General Improvement Fund—kind of “surplus” revenues—overseen and disbursed by the governor and legislators, needs “increased accountability.” Critics like Jacksonville attorney Mike Wilson, himself a former state legislator, call those grants “pork,” and an FBI investigation, revealed that current and former legislators in northwest Arkansas accepted bribes and helped direct more than $500,000 to a small Christian college.

At least one has pleaded guilty and is facing prison time.

Others appointed by Dismang and Gillam include: Senate Republicans Bart Hester, Missy Irvin, Dave Wallace, Dismang and Senate Majority Leader Jim Hendren. Senate Democrats include Minority Leader Keith Ingram, Sen. Joyce Elliott and Sen. Larry Teague.

Republican representatives include Joe Jett, Frances Cavenaugh, Jim Dotson, Lane Jean and House Majority Leader Mathew Pitsch.

Democrats, in addition to Johnson, include Warwick Sabin and Kenneth Ferguson.