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Times editorial

Tax swap leaves too many loose ends

Gov. Charlie Crist has demonstrated he can persuade voters to cut their taxes, but Amendment 5 is a different animal. It is a tax swap, not a cut, and it only hints at how the budgetary hole in public education would be plugged. If the governor's support for Amendment 5 is sincere, he needs to tell voters how he would fill in the blanks.

The Nov. 4 ballot amendment would cut all required local property taxes for schools, which amount to $8.3-billion this year and roughly 25 percent of each property owner's bill. There's also no question that such a cut would go far beyond the property tax limits voters adopted in January and would, as Crist told reporters, represent "a lot more than a tweak."

But the reason education groups are lining up against the amendment is that the swap was subjected to so much horse-trading at the Taxation and Budget Reform Commission that it is far from clear how, or whether, the schools will be made whole.

The intent was to replace school property taxes by repealing special-interest exemptions and exclusions to the sales tax, but the amendment allows for a one-cent increase in the sales tax and "spending reductions" and "other revenues identified or created by the Legislature."

No one who has followed the Legislature's phobia to taxes and obedience to special interests has high expectations for an honest debate on replacement revenues, if the amendment does pass. Sen. Mike Haridopolos, who is in line to become Senate president, already is spending much of his time trying to defeat the measure, and he is joined by influential business groups that want to hold on to their sales tax breaks.

That makes the amendment a tough sell and puts the governor on the spot. School budgets already have declined in the same year in which he promised to "hold them harmless" from the previous amendment, and it will be tough to persuade voters to accept his assurances again. Arguing that lawmakers will somehow muster the courage to repeal tax exemptions if he himself refuses to lay out a plan also requires an big leap of faith.

In January, Crist was able to get away with a campaign that relied primarily on optimism and exuberance. But the economic "sonic boom" he predicted has yet to materialize, which makes his claim that Amendment 5 "could be a significant stimulant to Florida's economy" sound less than convincing.

The reason Amendment 5 is on the ballot is that lawmakers have been cowards when it comes to fixing inequities in the sales tax code. If the governor wants voters to believe the swap can be a fair deal and good for Florida, he needs to show them how.

Tax swap leaves too many loose ends 08/05/08 [Last modified: Monday, August 11, 2008 3:44pm]
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