By Howard Fischer Capitol Media Services
Arizona Realtors formally launched their bid last week to ask voters to ban state lawmakers from ever taxing services, even if it also would reduce or eliminate taxes on other necessities even if legislators say the revenues are needed.
The Arizona Association of Realtors submitted more than 400,000 signatures on petitions to put a measure on the November ballot to constitutionally prohibit a state sales tax on services. That includes everything from their own services to medical care, barbers, lobbying services and weight-loss centers.
Holly Mabery, a Prescott real estate agent who chairs the effort, said the desire is to protect senior citizens and the poor from new taxes that a future Legislature might impose.
But Mabery acknowledged that the ballot measure, if approved in November, would prevent lawmakers from revamping what is and is not taxed in a way that actually might have more benefit to those on fixed incomes.
For example, Arizonans now pay taxes to purchase school supplies, clothing, over-the-counter medications and even adult diapers.
Under current law, lawmakers could opt to make those purchases tax exempt, making up any lost revenues by taxing selected services. Or they could expand the list of what’s taxable to include services and reduce the overall state sales tax rate from its current 5.6 percent.
But this initiative, if approved in November, would block lawmakers from taxing not just basic services like medical care but also accounting, advertising, public relations, travel arrangements, nail salons, portfolio management and investment advice.
House Speaker J.D. Mesnard told Capitol Media Services that from a policy standpoint, he’s never been a fan of sales taxes on services. But the Chandler Republican, whose district includes part of Gilbert, said it’s not that simple.
“From a philosophical standpoint on how government should be run, I tend to believe that public officials need the flexibility to govern,’’ Mesnard said. “So putting restrictions on their ability isn’t helpful.’’
But Sen. David Farnsworth, R-Mesa, who chairs the Senate Finance Committee, has no such second thoughts.
“Taxes go up, up, up and government services are expanded tremendously,’’ he said. Farnsworth said he believes it is important to restrain the ability of lawmakers to raise any new taxes “since I consider socialism to be the real enemy of our country.’’
Mabery said there are politicians in Arizona who have said they want to produce more revenues by expanding the list of what’s taxable.
That includes state Sen. Steve Farley, D-Tucson, who now is running for governor, who has pushed to expand what’s taxable to generate dollars for education. Fellow Democrat David Garcia, also in the gubernatorial hunt, also has said the state needs to review what is now exempt from sales taxes.
Republican gubernatorial hopeful Ken Bennett also has mentioned the idea of taxing services, but in the context of making the state less dependent on income taxes.
There already are some constraints on the ability of lawmakers to raise taxes.
A 1992 state constitutional amendment requires a politically difficult two-thirds vote of both the House and Senate for anything that increases state revenues. That applies to any tax increase, including a new one on services, that does not include a commensurate decrease in other taxes.
The measure will be on the ballot if the Secretary of State’s Office determines that at least 225,963 of those signatures are valid.
That November ballot could be crowded with issues for voters to decide.
Petitions also were due last week for a measure financed by a California billionaire to require Arizona utilities to produce at least half their power from renewable sources by 2030. That is being fought by the state’s utilities who point out that nuclear is not included in that list.
Also set for filing were a “right-to-know’’ provision in the state Constitution requiring the disclosure of all sources of funds spent to influence elections; a law egalizing the possession of marijuana; and an income tax surcharge on individuals making more than $250,000 a year to raise money for education.
The ballot also will have yes-no questions on expanding the school voucher program, curbing the power of the Clean Elections Commission and cost-of-living adjustments to pensions of prison guards, judges and elected officials.