Friday, April 1, 2005

Another tax break?but not for the average Joe


It's only a guess, of course. But one very good reason why plain folks who bear the brunt of government tend to grade politicians so low is because lawmakers dish out breaks for those who need them least and ignores the rest.

Tax breaks usually go to those who have the quickest, easiest access to legislators, unlike run-of-the-mill taxpayers who have a tough time getting the ear of the very people who plead for their election day support every few years.

Take a look at House Bill 254, a controversial scheme that threatens to delay adjournment of the Idaho Legislature this week but, worse, threatens to perpetuate a cushy tax break for "farmer-developers."

There's history to this sleight-of-hand. In the 2002 legislative session, farmers who subdivided some of their land for real estate development were rewarded with a low agriculture tax rate on land whose value was rapidly appreciating.

The rationale of the law's sponsors was it takes time to develop land, and valuable property--on which agriculture uses continued--needed a break in the meantime. No such breaks for homeowners, of course, who have watched property valuations and taxes increase rapidly.

By the 2005 session, the "farmer-developer" tax break was under attack because of emerging abuses by land speculators and was amended by the House.

But the amendment—exempting up to 95% of a subdivided property's value from taxation for 10 years or more before being taxed like other property—still was considered outrageously unfair to other taxpayers expected to pay taxes on a property's full market value.

So, now late in the 2005 session, critics are trying to amend the law to have the full value of the property taxed and to have the tax take effect immediately when land is subdivided for development.

Special interest legislation that low-balls taxes and takes wealthy owners off the hook has far-reaching implications: For one, local schools are cheated out of needed tax revenues because of drastic under-taxation.

Attempts to end the special tax rate may fail this legislative session. The battle would then resume in 2006.

America's middle class has been taking big hits in family finances for the past several years. Higher fuel prices, some retirement pension plans going bankrupt, job losses to overseas companies, higher medical costs, rising property taxes.

For state legislators to add to this burden by giving wealthy landowners breaks on taxes that others must pay is an indefensible insult.

This law must be changed.




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