MONTGOMERY, Ala. — Alabama House Minority Leader Craig Ford (D-Gadsden) said Sunday that Republican legislative leaders are rejecting Gov. Robert Bentley’s tax hike package because it includes bills that Democrats have been proposing for years.
“Before the legislative session began, Gov. Bentley proposed a tax package that would raise about $541 million. And to his credit, he included certain proposals, such as increasing the tobacco tax and closing certain corporate tax loopholes… which have been part of the Democratic Party’s agenda for years,” said Ford. “It’s no surprise the Republican leadership in the legislature hasn’t supported the governor’s proposals. They don’t want to be seen supporting anything Democrats have been calling for.”
The governor’s plan called for a $205 million tax hike on tobacco products. This “sin tax” would increase taxes on cigarettes by 82.5 cents per pack, bringing the total tax on cigarettes to $1.25 per pack.
Rep. Ford has pushed the tobacco tax hike for several years, calling for a per-pack tax increase of as much as $1, which in 2012 he said would raise over $227 million in revenue for the state’s General Fund.
Gov. Bentley has also called for an estimated $20 million tax hike on corporations whose headquarters are located outside of the state, saying they need to “pay their fair share.”
“Revenue must increase,” Bentley said during his State of the State address. “If we are to pay our debts, cover the shortfall and create a stream of growth revenue for our stagnant General Fund we must look to increase our revenue.”
But to this point, the governor’s eight tax increase proposals have failed to gain much momentum in the Legislature.
“(I)f they don’t want to consider our ideas, they should at least offer some of their own,” Ford said.
One familiar idea that Ford has been pushing is the passage of a statewide lottery.
“It’s polling about 70 percent in all areas of the state of Alabama no matter what demographics we’re looking at,” he said. “The people of Alabama want to be able to participate in a lottery. Whether they’re going to play the lottery or not, they want to participate in it.”
The last time the state voted on a constitutional amendment establishing a lottery it failed by 8 points in a vote that saw 50 percent of registered voters go to the polls.
Though support for a lottery in the state has grown increasingly vocal since then, many on both sides of the aisle remain unconvinced that a lottery would be the answer to Alabama’s funding problems.
Dr. John Hill, senior research analyst at the staunchly conservative Alabama Policy Institute, has published several articles and studies arguing that state-sponsored gambling is harmful to society.
“Gambling damages almost everything it touches,” said Dr. Hill. “From increased crime rates, to addictions that last for years, to personal debt and bankruptcy, gambling is a scourge to any community that embraces it with the hope of making a fast buck. There is no truth to the idea that lotteries are a ‘victimless vice’ that only exists to entertain its players while benefiting noble causes such as education. The experiences of other states show that lotteries attract and entrap disproportionate numbers of the poor, minorities, underage gamblers, and the elderly.”
Liberal publications like ThinkProgress and Salon also tend to agree with Dr. Hill, worrying that implementing a lottery results in a de facto—if voluntary—tax and redistributes that money from the lower class families who tend to gamble more, to middle and upper class families who gamble less.
But in spite of the concerns, the lottery and other gambling expansions continue to be the revenue-raising plan of choice for many Democrats in the state.
However, several Republicans in the legislature have said they view the budget shortfall as another opportunity to shrink the size of the state government.
“Contrary to Gov. Bentley’s suggestions, our state government is not yet as fiscally sound as we can make it,” said Sen. Slade Blackwell (R-Mountain Brook), who has emerged as a leading opponent of the Bentley plan. “Taxpayers have heard that the only remaining savings are ‘nickel and dime’ cuts that may not add up to enough to fill our budgetary gap. The problem is that those nickels and dimes come from Alabama’s taxpayers, and we have an obligation to make sure they’re not wasted before we even think about asking for a penny more.”
But Ford said he has not yet seen an official proposal from the Republican legislative counterparts.
“The legislature cannot run away and hide any more,” said Rep. Ford. “The Republicans wanted to be in leadership, and now it’s time for them to step up and offer solutions.”
(Elizabeth BeShears contributed to this report)
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— Cliff Sims (@Cliff_Sims) December 3, 2014