Thursday, May 11, 2000
RE: Utah Taxes Now Conference: Tax and Spending in the New Millenium.
CONTACT: Greg Fredde, Vice President, 972-8814 or 550-8390 (cell)

Taxpayer Conference looks into Internet Taxation, Education Funding

Two members of the Advisory Commission on Electronic Commerce, Governor Michael Leavitt and Grover Norquist, president of Americans for Tax Reform, are presenting their conflicting views on Internet taxation in Utah this Friday. These two speakers are just a sampling of speakers who will take both sides of the issues of Internet taxation and education funding at the Utah Taxpayer Association’s conference May 12, from 8:30 a.m. to 2:00 p.m at the DoubleTree Hotel in Salt Lake City.

Grover Norquist has been a vocal opponent of efforts by Governor Leavitt and others to allow state and local government to collect remote sales taxes.

“Leavitt’s continued assault on the Internet should be viewed as a direct threat to taxpayers and to those who utilize the Internet in their daily lives,” said Norquist, a staunch defender of keeping the Internet free from government intervention.

“Amazingly, Leavitt’s call to tax the Internet to increase state and local revenues comes at a time when most states are running sizeable budget surpluses,” Norquist continued. “Moreover, state and local revenue has grown from 6.9 percent of Gross Domestic Product (GDP) in 1968 to 9 percent of GDP in 1998.”

Recently, Governor Leavitt has obtained nation-wide attention as a leading advocate for the collection of sales and use taxes on remote sales, which have been legally owed for many years. The National Association of Governors (NGA), which Leavitt chairs, argues that “the interest of the states is to ensure that every American is treated equally and that taxation is based on if they buy, not how they buy and where they sell.” In addition, the NGA rejects the claim that governors see remote taxation as a “cash cow.”

“Governors have cut taxes every year for the last five years in a row, cutting state taxes by more than $20 billion. Closing tax loopholes that benefit some businesses at the expense of others would allow governors to continue to reduce taxes in a way that benefits everybody more fairly,” the NGA argues.

Another subject of the conference is education funding. Utah has the lowest funding per pupil among the 50 states while having one of the largest budget percentages dedicated to education. Discussion will focus on whether the state should fund additional increases in public education and explore alternatives to the current system. Some education groups, such as the Utah Superintendents Association and the Utah School Boards Association, have proposed large tax increases to raise additional money for public schools. Education reformers such as Rep. John Swallow (R-Sandy) advocates tuition tax credits to reduce student growth and thereby provide more funding for students remaining in the system.