Reform? Definitely Refrain.

The editorial page of the Free Lance-Star this morning decided to tackle the prickly issue of Virginia tax reform.

Del. William Howell, R-Stafford and speaker of the House of Delegates, fired a Halloween broadside against Gov. Warner’s pledge to reform the Virginia tax code. In a speech before state Chamber of Commerce directors, Mr. Howell urged the governor to abandon any reform plan that would beget a major tax increase.

The speaker had wanted the issue to be part of the campaign debate. But Mr. Warner didn’t cotton to having tax reform–which, for many, translates as a tax increase–make the campaign trail any more treacherous for Democrats than GOP-crafted redistricting already had made it. Too bad that the governor didn’t trust the voting public to separate reasoned discourse from demagogy.

Indeed. Everyone agrees that the Virginia Tax Code needs to be overhauled – especially at the local level where property taxes are squelching any opportunity for fixed income residents and retirees to hold on to their homes in the face of rising property values.

But part of the problem is the approach, and it is unfortunate that the claims of increased services are going unchallenged.

Mr. Howell argues that after yielding enormous annual revenues just a few years ago, Virginia’s tax system should not be labeled dysfunctional today. But the economic growth of the late 1990s, based substantially on the ability of gelded e-stocks to impersonate stallions, won’t soon be repeated. Also, after severe cuts to cover Virginia’s budget shortfall of more than $2 billion, government belt-tightening won’t produce much more cash.

One message from Virginia voters in the recent election is that while they share a distaste for taxes, they don’t take a shine to partisan pigeonholing. No-tax pledges are carrying less weight now because voters have confidence that, in Virginia at least, elected officials know better than to view them as automated teller machines.

BUZZ! Wrong answer.

The fact of the matter is that state spending in the Commonwealth has far outpaced the demand for services. Over the past five years, state spending has increased by 50% in a state drunk with tax revenue from the tech boom. Efforts to pass bond referendums have failed dramatically in some of the most liberal portions of the Commonwealth – Northern Virginia and Hampton Roads. While Democrats squeal for increased funding for public schools, many Virginians are demanding school choice and home schooling as a solution to the rising cost (and lack of quality) of public schooling.

The slam on the no-tax pledge didn’t go unnoticed, and rightfully it should draw the ire of any tax-and-spend moderate, precisely for the reason that it protects taxpayers from any raid on their pocketbooks in a time of crisis. When the family budget get constricted, families tighten their belts. Virginia General Assembly on the other hand expects hard working families to pony up the extra cash to pay for overexpensive programs that simply don’t work – public education and the excoriating cost of transportation being two of them.

There are solutions to Virginia’s budget crisis that do not involve impact or injury to the taxpayer. One of them is a complete restructuring of the local and state tax code to reflect income rather than property. Another is the promotion of school choice on the local level. Yet another is the contracting of the building of state roads to private companies rather than the more expensive route of VDOT. Since these are the two most pressing issues in the Commonwealth today, we need swift reform in those two areas as well as tax reform immediately and together rather than done piecemeal.

So long as Chichester and Warner are content to settle for mediocrity that squeezes working families a bit more, there will never be equitable and fair tax reform in the Commonwealth. That reality should not be passed over for the sake of expediency.