Press release from the Vote No on 3 Campaign; October 27, 2014:
NASHVILLE – As the final week of early voting begins, the Vote No on 3 campaign, representing a broad spectrum of community organizations, religious groups, working families, and businesses leaders, is voicing its opposition to Amendment 3 on Tennessee’s November ballot.
“There’s no two ways about it, Amendment 3 will put Tennessee on a path to a double-digit sales tax on food and other necessities, higher property taxes, and damaging cuts. Tennessee already has the highest average sales tax in the nation. By painting us into a fiscal corner, Amendment 3 will lead to a double-digit sales tax on food and other basic needs,” says Dick Williams of the Vote No on 3 campaign.
Amendment 3 is the constitutional amendment that would on its surface, prohibit creation of a state income tax, but as the Vote No on 3 campaign notes, it will drive up other taxes in the process. The campaign notes that last line of the Amendment specifically ensures that politicians will continue to have the authority to increase any other tax already on the books in 2011. “That’s just a free pass to keep hiking the sales tax on food and other necessities, increase property taxes, and more,” adds Rita Neill, retired teacher.
Local business leaders are concerned with the high sales tax Amendment 3 will create. “By limiting our options, we will be forced to rely on forms of taxation such as our sales and property taxes which hurt both consumers and business owners,” says John Noel, local real estate investor. “If Amendment 3 passes, that sales tax will go even higher with devastating impact on locally-owned businesses and jobs. Tennessee’s unemployment rate is already higher than six of our eight neighboring states, and our job growth lags behind the region as well. With Amendment 3, that will only get worse.”
Rev. Dr. Marvin Mercer, Sr., President of Tennessee Baptist Missionary and Educational Convention raises other concerns with the high sales tax Amendment 3 would bring about, “The double-digit sales tax on food and other basic needs will place a heavy load on the backs of working families and future generations. It will make it harder for working families to put food on the table, clothing on their backs, and provide for their families’ most basic needs.”
Local property taxes could also go up as counties scramble to make up for state shortfalls and cuts. “We’re retired and living on a fixed income,” says Valerie Walling. “It’s hard enough to keep up with our house payments as it is. If Amendment 3 passes, the higher sales and property tax will force us to reconsider whether we can afford to stay here in this community.”
Supporters of Amendment 3 claim that Tennessee’s lack of an income tax is a big draw for business and jobs, but the data shows quite the opposite. At 7.4%, Tennessee’s unemployment rate is higher than six of our eight neighboring states, all of which have an income tax. Tennessee’s job growth rate also lags behind the region. According to the Economic Policy Institute, taxes actually play a very small role in business location. Much more important are the quality of education, local infrastructure, and access to resources, the very services that may be cut even further as budget shortfalls are being discussed again in Nashville.
“Tennessee is in competition for talent with many other states. The quality of schools and colleges, libraries and arts, parks and forests, transportation networks, security provided by police and courts, and health services are important. Tennessee must have a capable and fair tax system to sustain attractive public services to retain its vitality. Future governors and legislators should have the option of deploying an income tax when necessary for the advantage of Tennesseans,” adds Malcolm Getz, Economist at Vanderbilt University.
“We are encouraging voters to read the fine print of this Amendment, particularly that last line,” adds Dick Williams. “It’s important that we preserve the democratic right of future generations to decide what’s best for the realities they may face 10, 20 or 30 years from now. Tennessee cannot afford the double-digit sales tax on food and other necessities, property tax hikes, or damaging cuts Amendment 3 will bring. We are encouraging voters to get involved by visiting VoteNo3.org, and most importantly, by voting ‘NO’ on Amendment 3.”