Attorney General and gubernatorial hopeful Terry Goddard, who has been mum on whether he’d support the May 18 temporary sales tax increase, made a counter-proposal to Gov. Jan Brewer Wednesday, saying he can’t support it if he doesn’t get more clarity on whether Brewer will veto tax cuts for corporations if they pass this legislative session.
In a letter to Brewer, Goddard said the three-year sales tax boost from 5.6 percent to 6.6 percent offers a “temporary and incomplete solution.” At a projected $1 billion in revenues, it only raises a third of what’s needed to cover the deficit, he noted, and said it does it by imposing new burdens on a “struggling middle class whose collective buying power will be crucial to pulling us out of our current slump.”
He said a more equitable solution might have been closing tax loopholes, singling out memberships for country clubs as an example.
But worse than that, he said, voters don’t know whether corporate tax cuts are in the works. The House has already approved a package that includes business tax cuts, although that package awaits action in the Senate.
“Arizonans like my wife and me cannot support your proposed sales tax increase if you intend to follow it with across-the-board corporate tax cuts,” he wrote. “I call upon you to pledge your veto to any non-targeted corporate tax giveaways that would appreciably offset the short-term revenue gains from Prop. 100.”
While Brewer has called for tax reforms that would she said would kickstart the economy, she said she will not support “irresponsible tax measures that would cause damage to Arizona’s current budget crisis.”
The failure of the ballot measure, she noted, would spell a loss of $400 million missing to classrooms and $120 million from higher education, not to mention losses to public safety and health services.
She took Goddard to task for coming late to offer solutions. “It's amazing that the day after the budget is passed by the Legislature, the Attorney General finally begins to talk about Arizona's budget crisis,” she wrote in a prepared response.
The Yes on 100 campaign declined comment, leaving it to Brewer’s office.
But John Wright, president of the Arizona Education Association, said he is still hoping his members and supporters of public schools will support the proposal.
“We don’t take it lightly for some of the reasons the Attorney General has referenced,” he said, noting he has continued to express “real concern that this revenue from a temporary increase not be offset by an ill-conceived tax giveaway that benefits corporations and the richest Arizonans.”
Still, he said, “It is really important for the temporary increase to pass. The times are dire, the need is urgent and the budget cuts that would be triggered were it not to pass would be devastating to public schools. But we have to understand this is not a solution. We need a real structural solution for long term stability.”
All of Brewer’s Republican primary opponents — Tucsonan John Munger, weapons facility owner Owen Buz Mills and Treasurer Dean Martin — have taken stances against the ballot measure.