Post by Logan on Jun 4, 2016 0:11:54 GMT -6
Gov. Bill Haslam expressed concern last month when the Tennessee legislature approved a bill to cut the state’s Hall income tax rate this year and to eliminate it entirely in 2022 — but he signed the bill into law on May 20, without any public comment on his change in view.
But the governor told reporters in Knoxville on Tuesday that he received assurances from legislative leaders that lawmakers would cut state spending to make up for the revenue lost from eliminating the tax if overall state revenues decrease to the point that spending cuts are needed.
"I told the legislature my concern was they were promising to cut taxes without promising to make commensurate expense cuts, and if the economy slowed down and revenues didn’t continue where they are, then that would be a problem. Their leadership assured me that if that time came, they would make the appropriate adjustments," Haslam said in a brief question-and-answer session with reporters after a speech to the Knoxville Rotary Club.
The Hall tax generated $304 million in fiscal year 2015: $198 million for the state and $106 million for cities and counties. Senate Bill 47, which lawmakers approved in April and the governor signed into law on May 20, cuts the Hall tax rate from 6 percent to 5 percent for tax year 2016, declares that it is the legislature’s nonbinding "intent" that it be reduced by 1 percentage point per year, and eliminates it effective with tax year 2022.
Read more: www.tennessean.com/story/news/politics/2016/06/01/haslam-assured-spending-cuts-hall-tax-repeal/85266896/
But the governor told reporters in Knoxville on Tuesday that he received assurances from legislative leaders that lawmakers would cut state spending to make up for the revenue lost from eliminating the tax if overall state revenues decrease to the point that spending cuts are needed.
"I told the legislature my concern was they were promising to cut taxes without promising to make commensurate expense cuts, and if the economy slowed down and revenues didn’t continue where they are, then that would be a problem. Their leadership assured me that if that time came, they would make the appropriate adjustments," Haslam said in a brief question-and-answer session with reporters after a speech to the Knoxville Rotary Club.
The Hall tax generated $304 million in fiscal year 2015: $198 million for the state and $106 million for cities and counties. Senate Bill 47, which lawmakers approved in April and the governor signed into law on May 20, cuts the Hall tax rate from 6 percent to 5 percent for tax year 2016, declares that it is the legislature’s nonbinding "intent" that it be reduced by 1 percentage point per year, and eliminates it effective with tax year 2022.
Read more: www.tennessean.com/story/news/politics/2016/06/01/haslam-assured-spending-cuts-hall-tax-repeal/85266896/