NCPA - National Center for Policy Analysis

Signs Of A Tax Revolt

July 5, 2000

The initial signs of a tax revolt are becoming evident. In Tennessee, Republican Gov. Don Sundquist attempted to impose a state income tax. (Tennessee is one of only nine states without a state income tax.) His original proposal would have imposed a 3.75 percent income tax rate on most Tennesseans. Faced with grass roots opposition, he proposed imposing a five percent rate only on those earning more than $100,000. By late June, the legislature had abandoned the income tax altogether.

Fueling the potential revolt, the federal tax burden has risen as a share of gross domestic product in recent years.

And there are other signs of brewing tax revolt:

  • A recently released Wall Street Journal/NBC poll shows support for using the budget surplus to provide an across-the-board tax cut rising to 38 percent from 34 percent 2 years ago.
  • A CNN/Gallup/USA Today poll in March found that taxes were the number one economic problem in America.
  • The percentage of Americans listing taxes as their principal concern almost quadrupled in the past year from 3 percent to 11 percent.

Furthermore, on June 9, the House of Representatives voted overwhelmingly to abolish the federal estate tax. The Democrats responded with a proposal to cut all estate tax rates by 20 percent, which Bill Clinton said he would sign. After this measure failed, 65 Democrats voted for the repeal bill. Then on June 26, Clinton said he would also support a big tax cut for two-earner married couples.

And in New Jersey, former Gov. James Florio (D) was buried on June 6 in his effort to gain the nomination for the U.S. Senate. Florio broke a pledge not to raise taxes after he was elected governor in 1989, and imposed the largest tax increase in New Jersey history, for which he was thrown out of office in 1993.

Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis, July 3, 2000.

 

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