Often the topics have been national or international in scope — global warming, affordable health care, economic competitiveness.
This year, though, the forum focuses on an issue with primarily North Carolina implications: Have we outgrown our current system of taxation?
Panel discussions will examine ways in which the state’s tax code might be shifted and how growing student and elderly populations will put more demands on state and local government in the future.
Hunt says he hopes the forum will spark more public debate and put North Carolina on the path of serious tax reform.
But any dramatic changes, if they ever happen, may take a while.
Gov. Mike Easley, after championing a few minor adjustments to the tax code during his first years in office, has already indicated that he’s not real interested in doing the kind of heavy lifting needed to bring about more significant reform. That’s not surprising given that real government reform is typically pushed by need. With tax collections picking up, the driving force for tax reform is drying up.
Advocates for change, though, call current sales taxes outdated, missing retail transactions in a modern economy where purchases of services have become as important as purchases of goods.
Hunt’s goal is a noble one. The state’s tax system is antiquated. It’s also been pushing more of the tax burden onto the middle class for a couple of decades.
But whether today or a decade from now, Hunt and other tax reform advocates face some substantial political obstacles to get significant changes passed into law. Any misstep will create the kind of public mistrust sure to doom the effort.
Just recently, in advance of the forum, the Emerging Issues Institute issued a collection of tax options discussed by members of three working groups made up of government officials, business leaders, think tank types and tax experts.
The ground covered wasn’t new. It included everything from replacing income taxes with a consumption-based tax system to more modest talk of lower corporate taxes favored by the business establishment. Expansion of the sales tax into the service sector was also a big topic.
The institute report emphasized that the options were meant to simply begin public debate. And at several points, working group members discussed the need for “revenue neutral” solutions in which an expansion of the tax base was accompanied by lower rates so that overall taxes didn’t increase.
Clearly, a revenue-neutral plan is the only way that comprehensive tax reform ever becomes law. But it’s not enough.
Missing from the report was any talk of winners and losers. And any plan that sticks it to one class of taxpayers — be it the poor, middle class or wealthy — at the expense of another will lead to just as much public opposition as one that raises taxes.
Scott Mooneyham writes for Capitol Press Association. Contact him at smooneyh@nc insider.com
