Guest Column

Peter Ferrara



NoVa Gets Whacked -- Again

 

Northern Virginia already sends twice as much in taxes to Richmond as it gets back from the state. The disparity will only get worse under Gov. Warner's tax plan. 


 

A study by the staff at the Fairfax County Board of Supervisors concluded that for every tax dollar Northern Virginia sends to Richmond, the region receives back in state spending only 19 cents.

A more accurate number based on studies at the University of Virginia is probably 46 cents in state spending for every dollar in taxes.

But whatever the exact number is, it’s going to get a lot worse if Warner’s tax increase plan is enacted. His plan would increase taxes on Northern Virginia, and Fairfax County in particular, much more than in the rest of the state. That new tax money, however, will mostly go to the rest of the state, not Northern Virginia.

As a result, Northern Virginia will end up getting back in state spending an even lower percentage of the taxes it sends to Richmond.

The
unfairness to Northern Virginia stems from the two main components of the Governor’s tax plan. First, the Governor proposes a 10 percent income tax increase for those earning over $100,000 per year.

A much greater proportion of families in Northern Virginia, and in Fairfax County in particular, earns over $100,000 per year than in the rest of the state. The governor’s proposal might as well be called the McLean-Great Falls-Reston-Vienna tax hike of 2004.

The governor also proposes a 22 percent increase in the sales tax. But again, along with the higher incomes, there’s a lot more in sales per capita in Northern Virginia than in the rest of the state.

Voters in Northern Virginia already said no to the sales tax increase in the Governor’s plan. In November, 2002, they rejected an increase half as large by a margin of 55 percent to 45 percent, even though foolish business special interests spent $2.5 million to hoodwink voters into supporting the idea.

But Warner quite clearly doesn’t care what the voters think. He deliberately waited until after the election to release his record tax increase plan precisely to preclude voters from having a say in the matter. He even bragged to the Washington Post about this anti-voter strategy.

This is the same Warner who ran for governor in 2001 with a huge ad campaign saying he would never dream of raising taxes, and that his opponent Mark Earley was a scumbag politician for suggesting he would. He sees no dishonor in now proposing the largest tax increase in the history of Virginia
.

Personally, I would support impeaching him over this behavior. But maybe no one else cares about the integrity of the democratic process in the state. On the tax issue, at present there is no democratic process in the state.

Warner’s own budget shows that his proposed record $1 billion tax increase is totally unnecessary. Even without any tax increase, he would be able to propose a total spending increase in this new budget of 8.5 percent. 

But that is not enough of a spending leap for this allegedly moderate Governor. He proposes the tax increase so he can propose a budget with a spending increase of 10.4 percent, which he has done.

Do we really need the largest tax increase in the history of Virginia so that we can increase spending next year by 10.4 percent instead of 8.5 percent? Do we in Northern Virginia really need that when the increased taxes fall on our region much more than the rest of the state?

Perhaps we deserve that, with local leaders like Bill Lecos, President of the Fairfax Chamber of Commerce.  Lecos is out vigorously cheerleading for this tax whacking of our region, and the people he is paid to represent.

To Lecos, higher taxes and government spending equals higher quality of life. Even when the higher taxes are in Northern Virginia and the higher spending is in Danville. Now we know where Howard Dean got his tax and fiscal policy ideas.

Then we have elected leaders like Sen. Janet Howell, D-Reston, who in theory represents McLean and Great Falls. Does she have any interest at all in representing the interests of her constituents?

Or does she have a sign on her door in Richmond that says, “Please tax my voters more”.

But the vote on the Governor’s tax package has far greater significance for Republicans in the legislature than Democrats. Quite simply, any Republican who votes for the largest tax increase in Virginia’s history so the state can increase spending next year by 10.4 percent instead of 8.5 percent will have a scarlet T emblazoned on his or her forehead for the next 10 years.

The taxpayer groups will have a concrete, critical vote to prove to constituents that their supposedly Republican representative is actually a Howard Dean liberal. Rest assured that for every Republican who votes for the governor’s outrageous record tax and spending hike, organization for a primary challenge will begin the very next day.

This is not personal. But grassroots Republicans and taxpayers are entitled to fight for what they believe in, and against what they don’t. And what they believe in is maximizing taxpayer freedom and overall economic prosperity, not Swedish socialism.

-- January 19, 2004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Peter Ferrara is director of the International Center for Law and Economics in Fairfax and president of the Virginia Club for Growth.

 


 

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