There are four state constitutional amendments on the ballot this November. The first deals with abortion and the second revises how judges are selected, both of which will get plenty of media coverage. The fourth is a perfunctory change that would allow veterans groups to hold bingo tournaments. The third amendment is one that will be overshadowed but is just as important. If approved, Amendment 3 will finally settle the question of an income tax in Tennessee. Despite language in the Tennessee Constitution that permits only an income tax on investments (i.e., the Hall Income Tax, which incidentally Beacon is seeking to put to rest as well), this hasn’t stopped past attempts to impose a destructive income tax on Tennesseans’ hard-earned labor. Three times the state’s highest court has said an income tax is unconstitutional, but a former attorney general once opined that if properly worded, the legislature can impose one nonetheless. That’s precisely what state lawmakers did in 2002, and it was ugly. Dragging out into the summer months, the legislature failed to pass a budget, shutting down all but essential government services. (I even remember getting out of school for a few days when my university shut its doors temporarily. For that I am grateful.) I’m even more grateful that enough state legislators stood firm against the Democratic legislative leadership and Republican governor. Since then, the term “income tax” has been a political pariah in all but the most left leaning of circles. But that doesn’t mean it always will be. Demographics change, and someday lawmakers might succeed at doing what their predecessors back in 2002 were unable to accomplish: the utter destruction of our economy. And they will likely have plenty of help. Advocates from all stripes lobbied for an income tax back then and would relish at the chance to do it again. Special interest groups, many representing local governments thirsty for easy access to more taxpayer money, wore buttons emblazoned with “Do the Right Thing.” According to multiple legislators reflecting on the time, even school boards and their association abdicated their direct mission of educating students to push for the unpopular tax. Fortunately, lawmakers did “the right thing”—albeit the opposite of what these special interests wanted—and rejected an income tax. That’s important, because every day 20,000 taxpayers flee states that impose an income tax and settle in non-income tax states. And since 1967, states that tax income have witnessed an explosion in the size of government (up 42 percent) and an equally devastating implosion in personal income (down 64 percent). That’s why Amendment 3 matters. It will ensure that Tennessee will forever remain income tax-free, despite whatever harebrained tactics politicians and special interests might otherwise try. -Justin Owen Enjoy the Beacon blog? Help us keep it going with a tax-deductible gift.
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