Longmont Florist

Subscribe to the Daily Times-Call

 

LongmontFYI Home

AP MoneyWire

LongmontFYI Home | Local & Regional News | Sports | Business | Opinion | Community | Health | Entertainment | Find a Car
Real Estate | Classifieds | Submit A Classified Ad | Subscribe to the Daily Times-Call | Contact Us

Publish Date: 4/24/2005

Budget fix would suspend tax breaks


DENVER — Valerie Hawthorne-Bey was counting on the state earned-income tax credit to help her buy asthma medicine for her son, but that tax break will shrink and others will disappear for five years if voters approve a budget-fix proposal on the ballot this fall.

“I understand the big picture, but I don’t know how I’m going to get by for five years,” Hawthorne-Bey said. “(Legislators) can bet I’m going to be watching to see how they spend the money. They will be held accountable.”

The 19 tax breaks, including a sales tax refund for all taxpayers, had been funded out of “surplus” money — state tax revenue that exceeded the limits set by the Taxpayer’s Bill of Rights.

TABOR, a constitutional amendment, requires the surplus to be refunded to taxpayers. If voters approve the budget fix on the ballot in November, the state would be allowed to keep $3.1 billion of the surplus over five years.

Lawmakers have said the money would be spent on education, transportation, health care and pensions for firefighters and police, areas that have suffered from a revenue crisis caused by the recession and other factors.

The other 18 tax breaks for child care, foster care, businesses equipment, doctors who work in rural areas, telecommunications scholarships and other programs would be reduced or suspended altogether.

Sen. Mark Hillman, R-Burlington, said that was a necessary part of the deal to get the budget fix before the voters.

The tax breaks have been the subject of strong debate and sharp criticism since the Legislature started doling them out in 1999, after Gov. Bill Owens took office.

Democrats said Owens used the tax credits to reward special-interest groups at the expense of average taxpayers. Owens, a Republican, said the beneficiaries had paid a disproportionate share of taxes and deserved to get some of the money back.

Republican state Treasurer Mike Coffman is a critic of the tax credits. If voters agree to suspend them, voters should also get to decide which ones return after the five-year suspension, he said.

“If legislators keep giving out surplus through tax credits, the typical Colorado taxpayer won’t see a dime of the surplus they funded in the near future,” Coffman said. “Taxpayers should have final approval if any surplus is withheld from them.”

Rep. Bill Cadman, R-Colorado Springs, introduced a bill to require voter approval for tax credits financed with TABOR surpluses. Cadman’s measure itself requires voter approval, and if it passes the Legislature, it could be on the November ballot along with the budget fix.

Hillman said the tax credits should be examined closely before they are restored. He said the credits were approved when the economy was booming and state economists were forecasting billions of dollars in TABOR surpluses for the foreseeable future.

That changed when the economy soured, forcing the state to cut about $2 billion in spending over the past three years, he said.

Hillman said lawmakers should consider financing future tax credits from the general fund, the state’s primary bank account, instead of taking it out of the TABOR surplus.

“We should be spending the government’s money instead of redistributing the taxpayers’ money,” Hillman said.

Hawthorne-Bey said the tax credits were a good investment, helping low-income residents get ahead, get better jobs and then pay higher taxes.

  Coldwell Banker
  Prestige
  Formby Ford
  Bassett Carpets
 

Hajek

Melody Homes
 

Valley

  Centennial Bank of the West
 

First National Bank

Sindelir


Now in your Sunday Times-Call
  Click for
Suicide Prevention Hotline Numbers
Movie Listings What's at the Movies?
Get the listings here
Reporter-Herald logolDaily Record logolLouisville Times logo
Lafayette News logolErie Review logol Superior Observer logo
LongmontFYI Home | Local & Regional News | Sports | Business | Opinion | Community | Health | Entertainment | Find a Car
Real Estate | Classifieds | Submit A Classified Ad | Subscribe to the Daily Times-Call | Contact Us

Copyright © 2005 The Daily Times-Call