Warner’s plan has strong points
Published 12:00 am Wednesday, November 26, 2003
Among the many gripes that people have with taxes is the inequality of the wealthy getting to pay noticeably less than those in the low- to middle-income brackets. In Gov. Mark R. Warner’s proposed tax reform plan, released Monday, this issue would be addressed.
For example, corporations that have relied on loopholes would find them closed, thus yielding the state more money. Also, individual taxpayers making more than $100,000 a year will go from paying 5.7 percent of their income to 6.25 percent in taxes annually. Other highlights include: personal exemptions would go up from $800 to $1,000; raise the standard individual deduction from $3,000 to $4,000; cut out the so-called marriage penalty by increase the standard deduction for married couples from $5,000 to $8,000; and lower tax rates on the first $20,000 of income.
Warner and his administration claim that 65 percent of Virginians would pay less overall so, in his words, &uot;if two-thirds of Virginians are getting tax relief, that’s great news for the Virginians who pay the bill.&uot;
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Warner also hopes to increase the Commonwealth’s coffers by asking for a 10-fold raise in the 2.5-cent-per-pack cigarette tax. This particular measure could likely get strangled with the help of tobacco lobbies, but it’s still worth a try.
As if that’s not enough, the governor is calling for cutting the food tax (from 4 cents on the dollar to 2.5 cents by 2005) and adding a penny to the state sales tax.
All this is calculated to give the state $478 million more for the next fiscal year, and $541 million the following year. Considering the budget shortfalls Virginia has experienced in the past, every dollar counts.
Naturally, there will be opponents for everything Warner is suggesting. Nonetheless, the Commonwealth needs some strong plan of reform. If Virginians want a fair and strong economy, we must be willing to pay for it.