How TABOR is the HB2 of tax policy

I’m a skier. I love Colorado. There are times when I’d like to pick up the Rockies and place them right here in North Carolina. But there’s one part of Colorado I don’t want to transport to our state: TABOR.

What is TABOR? The fact that people probably have to ask is what some North Carolina lawmakers are counting on. TABOR stands for “Taxpayer’s Bill of Rights,” which sounds great, right? That’s what Coloradans thought, too, when the law passed in 1992.

Unfortunately, TABOR and other income tax cap laws – such as the “Millionaire Protection Act” being debated by the North Carolina Senate – lock in unfair tax rates that benefit the wealthy and force lower-income families to pay more through sales and property taxes. In fact, a 2015 study by Colorado State University found that more than 80 percent of Coloradans are paying more in property taxes now than they would have if TABOR never passed.

In 2005, Colorado voters temporarily suspended TABOR because of the damage it caused the state’s K-12 schools, colleges, universities and health services. Tim Hoover with the Colorado Fiscal Institute says his state’s experience with TABOR has “been a complete and unmitigated disaster for the state of Colorado.”

Unfortunately, now some lawmakers want to bring the same thing to North Carolina. Economists warn that by limiting income taxes in NC, policymakers will be forced to pursue revenue through sales tax, and local governments will be prompted to raise property taxes. It’s a strategy they’re already employing, and I can only imagine what might happen when given the all-clear by an amendment.

It doesn’t matter what you call it, TABOR or the “Millionaire Protection Act.” Either is simply another giveaway to the wealthy that would further shift the tax burden onto working families. North Carolina lawmakers have enacted three tax hikes in the last three years through new sales and service taxes, as well as through more fees to get your car repaired and send your kid to college. Meanwhile, the state’s wealthiest continue to enjoy tax breaks and cuts on the backs of the rest of the state.

TABOR will amend the state constitution to make it difficult to remove such policies in the future – even if they fail. Policymakers already have the ability to affect tax rates and policies. Allowing them to do it under a “Bill of Rights” and armed with a constitutional amendment will remove the checks and balances so important to our democracy. It would force lawmakers to choose between huge increases in sales taxes and fees that disproportionately affect working families or massive cuts to public education and roads. That means fewer textbooks, larger class sizes, and we will never be able to pay teachers what they deserve.

You don’t have to take my word for it. The North Carolina Budget & Tax Center objects to TABOR, calling it “The HB2 of state budget and tax policy ideas.” AARP North Carolina spoke out against the policy. North Carolina’s Treasurer Janet Cowell has warned that TABOR “poses a real danger to our state’s finances and reputation.”

TABOR. Understand it. Research it. Supporters are counting on the fact that you won’t, and they’ll slip this through to our books. Trust me, if they’re successful, we’ll all be hiking a mountain of the Colorado variety to remove it.

This story was originally published June 27, 2016 at 4:45 PM with the headline "How TABOR is the HB2 of tax policy."