The People Will Speak On Income Tax Ban: State Senate

NASHVILLE – The State Senate continued to hear important legislation this week on top of trying to figure out ways to balance a budget which becomes more troublesome as the year progresses.

In addition, April 1 was the filing deadline for those seeking state office, and Senator Beavers is proud to have filed her petition to run for re-election.

“I look forward to continuing to represent the citizens of the 17th District,” said Senator Beavers. “The people of this district know that I am a consistent conservative who continues to fight for individual freedoms and who combats government encroachment into our lives. It’s about time people in Washington and Nashville stop trying to appease the special interests and government bureaucracies and start listening to the people of this state and country, and I am honored to have been a legislator who holds my colleagues accountable and always votes my principles.”

Senate votes to let people ban income tax through Constitutional Amendment

The State Senate approved 25 to 7, a major resolution this week that would allow Tennesseans to vote on a constitutional amendment to clarify the state’s prohibition of an income tax and a payroll tax in Tennessee.

The amendment, Senate Joint Resolution 763, which was co-sponsored by Senator Beavers, specifies that the legislature shall be prohibited from passing either an income tax or a payroll tax, which is a tax on employers that is measured by the wages they pay their workers.

A payroll tax has been proposed in recent years by elected officials in Shelby County and elsewhere as a way around an income tax.

A state income tax proposal has repeatedly come before state lawmakers over the last several decades, including failure by only five votes in the House of Representatives in 2002.

In January of this year, eight state lawmakers, seven of whom represent Shelby County, filed legislation, House Bill 3597, to implement a state income tax.

There have been three cases before the Tennessee Supreme Court throughout the state’s history that have upheld that the income tax is unconstitutional. The most recent case was decided in 1964 and this case has never been overturned.

However, an attorney general opinion in 1999 opined that the tax is legal. The opinion has prompted elected officials in Tennessee to continue to propose both an income tax and a payroll tax in recent years.

In order for a constitutional amendment to pass, it must first be approved by a simple majority in both the House and the Senate this year. Then, it must be approved by a two-thirds vote in each chamber during the next General Assembly in 2011-2012. After that the amendment would be placed on the next gubernatorial ballot for ratification by the people in November 2014.

Issues In Brief:

Additional revenue shortfalls – The State Funding Board met this week to update their revenue estimates for both the current and next fiscal year's general fund. The Board estimates revenues will be at a -1.78 to -2.31 percent loss for the current budget year, and are projected to grow at 2.05 to 2.3 percent in the 2010-2011 fiscal year. The new estimates mean Tennessee will need to make up at least $75 million more to cover the estimated revenue shortfalls to the proposed 2010-2011 budget. Finance officials anticipate an additional $28 million shortfall will occur as a result of losses in the cigarette tax, bringing the total shortfall to over $100 million.

Abortion / Coercion – Legislation to educate women that coercion to have an abortion is a crime in Tennessee passed the full Senate by a vote of 29-2-1. The bill, Senate Bill 3812, would require a physician’s office, ambulatory surgical treatment center, or other clinics in which abortions other than to save the life of the mother are performed to post signs to provide women with this information about the state law and their option to receive help if they are being threatened. According to a survey published in the Medical Science Monitor, over 64 percent of women who received abortions said they felt pressured or coerced into having an abortion. The sign would be posted in the waiting areas and patient consultation rooms, and would not apply to clinics where an abortion is performed to prevent the death of a pregnant female.

Tennessee Health Freedom Act – The Tennessee Health Freedom Act, Senate Bill 3498, overcame a major hurdle this week with approval by the House Industrial Impact Committee. Senator Beavers who is the Senate sponsor of the bill, as well as Lt. Gov. Ramsey and the Senate Republican Caucus, held a press conference last week urging the state’s House of Representatives to pass the bill, which was approved by a vote of 26-1-5 in the Senate in February. The bill would prohibit the federal government from imposing fines or penalties on a person’s decision for deciding not to participate in the federal plan. It also calls on the state’s Attorney General to take action in the defense or prosecution of rights protected under this legislation.

Advocating for small business – The Senate Commerce Labor and Agriculture Committee has voted to create a small business advocate within the Office of the Comptroller of the Treasury, utilizing existing personnel. Senate Bill 3484 calls for the advocate to mediate and assist with resolution of issues concerning small business owners and state departments and agencies. The bill also requires the small business advocate to prepare an annual report on their office’s activities, findings and recommendations to the governor, members of the General Assembly and the heads of the affected departments and agencies to make sure officials are notified about any problems or concerns.