Posts Tagged ‘taxes’
Fox 17 has a story about how some museums and tourist attractions receive taxpayer handouts, even though others that do not have much more visitors. Watch the entire interview here.March 14th, 2014 | Recent News
NASHVILLE – The Beacon Center of Tennessee today joined with other tax reform groups and legislators in support of phasing out the Hall Income Tax on stocks and bonds. House Finance Chairman Charles Sargent, Sen. Mark Green, Americans for Prosperity’s Tim Phillips, Americans for Tax Reform’s Grover Norquist, Tax Foundation’s Scott Hodge, and Beacon CEO Justin Owen unveiled a plan this morning to phase out the state tax.
The Hall Income Tax imposes a levy on income derived from stocks and bonds. It hits seniors and entrepeneurs the hardest, as both groups rely more heavily on this type of income than others. Beacon has featured the story of a retired couple who moved to Tennessee only to discover our state’s “income tax secret,” as well as the story of a young entreprenuer whose business decisions are negatively impacted by the tax. The stories can be found in Beacon’s new report, “Our State, Our Future,” linked here.
“It’s time for Tennessee to end this tax that overly burdens our seniors and job creators,” says Beacon CEO Justin Owen. “It drives investors out of our state and puts undue pressure on our retirees.”
Sen. Mark Green and Rep. Charles Sargent will spearhead the legislation, which will phase out the state portion of the tax over a period of six years. The measure also includes provisions to ensure that the phase out is done in a fiscally responsible manner.
“We are grateful that Sen. Green and Chairman Sargent have made this such a top priority,” continued Owen. “And to have national leaders like Grover Norquist, Tim Phillips, and Scott Hodge lend their expertise to the effort makes this a great day for Tennessee.”
The Beacon Center of Tennessee’s mission is to change lives through public policy by advancing the principles of free markets, individual liberty, and limited government.
###March 4th, 2014 | Recent News
In an effort to raise awareness about Tennessee’s income tax secret, Beacon Director of Policy Lindsay Boyd pens an article that originally appeared in Saturday’s Tennessean.
by Lindsay Boyd
As the 2014 legislative session of the Tennessee General Assembly gets into full swing, there are several issues that are dominating the headlines. Wine in grocery stores, opportunity scholarships for students, Medicaid expansion and a host of other subjects have become kitchen table conversations for Tennessee families.
Amid these timely topics is a sleeper issue that many may be unaware of — but one that drives straight to the heart of Tennessee’s reputation, culture and values.
If you have not familiarized yourself with the Hall Income Tax, perhaps it’s time to ask yourself this important question: Are you secure in your plans for the future? If you believe that you’re taking all the proper precautions to sustain yourself or your family for the years ahead, the impact of Tennessee’s Hall Income Tax may be reason to reconsider.
The Hall Income Tax was instituted in 1929 and applies to interest and dividend income received by individuals who maintain their legal residence in Tennessee. The controversy over this tax may not get the same coverage as the ability to buy a bottle of wine with your groceries, but the impact of the Hall tax is much more substantial. In the Beacon Center of Tennessee’s newly released report “Our State, Our Future,” the harmful effects of the tax are illuminated through the stories of Jon and Linda Freeman, a retired couple, and Nicholas Holland, a young Nashville entrepreneur.
Had Jon and Linda known about the tax before moving from Alabama, they may have looked elsewhere to retire.
“I wish these harsh taxes had been more clear to us before we came here,” Jon Freeman says.
Holland similarly asserts, “The Hall tax is not only an income tax, but an income tax of the worst kind: It punitively punishes a segment of our population, namely the elderly, who have taken risks with their hard-earned dollars and hope to see their risks pay off.”
Indeed, consequences of the Hall Income Tax loom large. Several studies suggest that a dividend becomes less valuable when more of it is taxed. Moreover, the tax encourages more people to sell stocks rather than begin to draw income from the investments, which impacts the financial planning of investors and has negative economic consequences for companies.
Yet, perhaps the most compelling argument against the tax is the destruction it causes to the lives of our senior citizens, who own a disproportionate percentage of dividend-paying stocks and are reduced to significantly smaller incomes as a result.
“My father recently passed away, and my mother — who would be considered very middle class — received some financial assistance through my father’s insurance,” Holland says. “We have discussed placing those funds into stocks that would give her a fixed income necessary for her retirement. However, the Hall tax makes this an unlikely option for us. Lawmakers should remember that seniors are among the most vulnerable of our population and the impact this tax has is not just limited to those individuals, but also to their families, who face the burden of assisting or providing for their loved ones,” he notes.
The Hall tax will be addressed by the General Assembly this spring, with several proposals already introduced that take varying approaches toward reducing or eliminating the tax altogether. It remains to be seen whether lawmakers will finally end this antiquated tax law from a bygone era.
Lindsay Boyd is the director of policy at the Beacon Center of Tennessee, and co-author of “Our State, Our Future.”February 23rd, 2014 | Commentary