In the News

Tax Alert
A bi-weekly Report by D. Ansell
Volume 6 Issue 6
March 22nd, 1999

Two North Dakota legislators named Enemies

Today, Americans for Tax Reform awarded the title of Taxpayer Villain of the Month to House Majority Leader John Dorso (R) and Representative Mike Grosz (R).

Dorso and Grosz introduced and pushed HB 1108 through the House in mid-February. This bill officially made North Dakota the "first legislative body in the entire United States to specifically approve a tax on Internet access,"according to Congressman Chris Cox (R-CA) author of the Federal Internet Tax Freedom Act. "On its face, portions of this bill would constitute an illegal tax under the Internet Tax Freedom Act," Cox went on to say.

The legislature led by Grosz and Dorso did not agree and helped pass the bill 69-28 on February 16th. "Mr. Cox does not know what he’s talking about. When I read that thing, I thought ‘What is this guy smoking?’" said Majority Leader Dorso.

Specifically the bill includes provisions regarding the obligation of an Internet service  provider (ISP) to pay a 2.5 percent gross receipts tax on Internet access. This proposal is bad news for North Dakota taxpayers, and moreover sets a dangerous precedent. The Internet is relatively regulatory and tax-free and should stay that way.

Taft or daft in Ohio?

Conservatives and Taxpayers alike are perplexed by recent comments made by Governor Bob Taft (R). During the Governor’s State of the State address he proposed over 40 programs and spending expansions according to the Buckeye Institute. Furthermore, and perhaps most damaging, was his proposal to eliminate the Income Tax Reduction Fund, which requires that the legislature return half of any surplus. Ohio has enjoyed a budget surplus for six straight years and is likely to break a record surplus established last year, of over $1 billion, in 1999.

So what does the Governor propose to do with this years surplus instead of  returning it  to taxpayers? You may have guessed it, the very politically popular idea of building more schools. "The Governor has effectively shut down one of the few sources of tax relief hard-working Ohioans have. As Ohio moves into the ranks of high-tax states, we ought to focus on more tax cuts, not less," said Buckeye Institute President Richard Leonardi.  It is also interesting to note that the rate of spending under Governor Taft is also soaring.  No wonder he needs more tax dollars, he is spending faster than the kid in a candy store.

"Taxing Tommy" Thompson aiming at Businesses

As if the state really needed another tax increase. Wisconsin, already being the number  two taxed state in the country behind only Connecticut, according to the Tax Foundation, is looking at another tax increase.

This time Governor Tommy Thompson’s (R) plan is to get the business community by dividing them. United we stand, divided we fall. According to the Milwaukee Journal Sentinel the proposal would raise $70 million over two years by requiring businesses to do combined reporting.

He has sweetened the deal by adding a provision allowing for a single-factor sales formula for businesses. This has been a long-sought-after change in the code. Presently the state factors in sales, property and payroll to determine how much income a corporation has. The business community will be fractured, many gaining from a single-factor sales formula and some unaffected by combined reporting. The Tax Alert begs to differ! Why now, why a tax increase? The state will likely have another surplus and already is the highest taxed state in the Great Lakes region.

Governor Gary Johnson ( R ) not blowing smoke

Democrats offered the Governor a deal they thought he could not refuse. A tobacco tax hike tied to a restriction on smoking in the Capitol. The reason they thought they could not lose, is because the Governor’s wife, First Lady Dee Johnson, has been pushing for the smoking restriction. Meanwhile the Governor vetoed a tobacco tax hike last year. His answer, a prompt announcement that he will veto the bill because he opposes any tax increase--even on cigarettes--he also does not smoke in case you were wondering (and is a Pledge Signer). He wins the Monthly Friend of the Taxpayer Award barely edging Governor John Rowland (R-CT).

Fax/e-mail or call ATR with your nominations or votes for heroes and enemies of the month to Damon B. Ansell.