Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, January 21, 1995 TAG: 9501240042
SECTION: CURRENT PAGE: NRV-3 EDITION: NEW RIVER VALLEY
SOURCE: THOMAS G. BAKER JR.
DATELINE: LENGTH: Medium
Legislators have spent a lot of time debating the proposed elimination of the business, occupational, professional and license tax that many localities levy. Businesses pay this tax on their gross receipts whether or not they make a profit.
Local government officials oppose the repeal, fearing the loss of the revenue that helps provide critical services such as police and fire protection. They also contend that elimination of the tax will require an increase in local real estate taxes to make up for lost revenue.
Those who favor eliminating the tax argue it discourages small businesses from opening or having additional money to expand, and that it also serves as a disincentive for new industry to locate in Virginia.
Until the last few days, I had not supported repeal of this tax. However, the legislation to be submitted ensures that the state will reimburse the localities, dollar for dollar, the monies lost by the repeal; that there will be no five-year state cutoff of state reimbursement as originally proposed; and that if the state ever fails to reimburse the localities, the localities may reinstitute the tax.
With these assurances I believe repeal of the business license tax will be an additional economic incentive to keep and attract industry. This, and other proven economic development legislation, such as enterprise zone designations, will help create jobs and increase revenue.
As you will recall, my enterprise zone legislation for Pulaski County was instrumental in the Volvo GM Heavy Truck Corp. expansion and, thus, the preservation and creation of approximately 2,200 jobs in Pulaski County and surrounding communities.
As with the business tax cut, the individual income tax cut proposal has also drawn substantial attention. Opponents of the individual income tax cut argue that the dramatic cuts proposed by the governor will result in an unacceptable decrease of state services that we have grown to expect and need. Proponents argue that by reducing the state's revenue, two desired results will occur: personal incomes will rise and the size and bureaucracy of government will decrease.
Although I philosophically agree with the principle of a phased-in tax cut, I do not want to do this at the expense of education and of losing a number of government services important to the people of our district.
That is why I have co-sponsored budget amendments to restore funding for Cooperative Extension at Virginia Tech as well as for the Offices of Youth. I am also supporting funding for our commissioners of revenue and treasurers as I believe the personal service delivered locally (such as assistance with preparation of tax returns and helping solve taxpayer problems and concerns) can be better handled locally than in Richmond.
To contact Del. Baker, call 1-800-889-0229 or 804-786-6605 or send mail to P.O. Box 406, Richmond, Va. 23202. He can also be reached through his Dublin office at 674-4081 and P.O. Box 1847, Dublin, Va. 24084.
Keywords:
GENERAL ASSEMBLY 1995
by CNB