Two constitutional amendments have been submitted to Utah voters for consideration. Below is Libertas Institute’s brief analysis specifying our stance on both with our recommendation for how Utahns should vote.
Constitutional Amendment A: NO
This amendment would funnel money from the severance tax to a permanent state trust fund. The severance tax is imposed upon those who extract oil, gas, or minerals from lands within Utah. A portion of the revenue from this tax would, if the amendment were to be passed, be required to be deposited in the trust fund as opposed to the general fund, where money can more easily be allocated and spent by the legislature.
Proponents argue that these taxes are levied for extracting things from “our land.” This is a dangerous collectivist notion that liberty-minded voters should reject. If I plant a garden in my backyard, then the trees and plants extract nutrients from the soil. The idea of paying a tax to the government because I have used my property in a way I wish is absurd.
The supporters of this amendment also argue that funds should be set aside for future generations, since non-renewable resources belong not only to Utahns currently alive, but to future Utahns as well. “One day, non-renewable resources and associated revenues will shrink and ultimately disappear,” the supporting side writes. “At that point, if we haven’t invested any severance tax revenues for them, future generations will do without.” Assuming these resources would in fact dry up, along with the corresponding severance tax revenue, what is the problem with doing without?
It’s important here to note that many of those who publicly support this amendment are part of the government. To such individuals, a loss of tax revenue implies the inability to adequately fund government programs and services they deem important or politically expedient. All future Utahns would “do without” in this scenario is a nest egg of money to fund big government enterprises. In other words, barring other taxes and sources of government revenue, our posterity would be compelled to reduce the size of government. And that doesn’t sound so bad.
Voting against this amendment would mean that the money would continue to flow into the general fund, where it can be more flexibly allocated by the legislature. This is ideal in this situation, so that the severance tax can be reduced and eliminated, or at a minimum, the money generated can be returned to or spent on those being taxed. Collective property should not exist; all property, except for the government’s own specific needs, should be private. Further entrenching a taxation scheme into the Utah Constitution is problematic and creates additional barriers to reducing and removing the scheme in the future.
Libertas Institute recommends a NO vote on Constitutional Amendment A.
Constitutional Amendment B: NO
This amendment exempts a military employee or his/her spouse from paying property tax if the employee is in “active duty” for at least 200 days during the year. While we support individuals looking for ways to reduce their tax burden however possible when the taxes are illegitimate and immoral, as is the case with the property tax, we cannot endorse carving out exemptions within the system, for it is little more than discriminatory and preferential treatment.
The bill which created this amendment passed overwhelmingly in the legislature, and no argument against it was even submitted for inclusion in the voter guide. After all, who would want to appear unpatriotic by refusing to exempt soldiers from paying a tax?
Speaking for proponents of the amendment, Senator Luz Robles states that it “is about shared sacrifice”—spreading the tax burden amongst the rest of Utahns since, she says, “we must each do our part to support those who are willing to give all for our freedoms and liberties.”
Soldiers voluntarily enter into this career knowing the potential risks, costs, and proposed benefits. They are hired to do a job. If we are exempting one type of worker who is away for 200 days, why not also exempt diplomats, missionaries, salesmen, or other individuals whose careers take them away from their Utah home for prolonged periods?
Whether or not a soldier’s assignment is moral and just, and therefore worthy of support, the fact remains that this amendment would create exemptions for a specific type of employment. Libertas Institute supports a complete elimination of all property taxes, but a piecemeal approach is wrong in that it elevates one class or group over another. While they exist, taxes should be equally imposed upon all. If any group of Utahns is to receive an exemption from property taxes, it should be those on a low, fixed income, such as many senior citizens, whose inability to pay rent to the government jeopardizes their ability to remain in the home they (theoretically) own.
Libertas Institute recommends a NO vote on Constitutional Amendment B.