Utah’s Income Tax Reform initiative takes effect on January 1st. Although I applaud the change, I disagree with one of the sentiments of the new program. The program cites that it increases simplicity by returning “to a single tax system.” This statement could not be further from the truth. Why? Because we as Utah citizens are still double-taxed. Not only are we taxed by the State on our income, but also through sales taxes. We are taxed at Walmart, Sam’s Club, and McDonald’s. Then we are taxed via a separate fuel tax at Chevron. Should you decide to take a vacation to an in-state hotel you are again taxed via lodging taxes. Although portions of these taxes are collected by local and county governments, the state is still imposing double-taxation on its citizens. Is there a more clear case of robbery? It is time for our legislature to get serious about real tax reform by eliminating all double-taxation! And there is only one way to eliminate double-taxation — abolish income tax or all sales taxes — you can not have both without double-taxation. I call on my fellow Utahns to get a strong voice on this issue to fix this problem.

I have been eyeing a federal movement called the Fair Tax. This movement is growing rapidly and I think a similar system at our state level would be a good solution. The concept is to eliminate all income tax and replace it with a sales tax. The sales tax would be on all new goods and services with only minor exceptions (i.e. food purchased at grocery stores). This would likely mean the State of Utah sales tax rate would likely become an astounding 9 or 10%, but it would literally eliminate all income tax and double-taxation. Some might argue that this will discourage economic growth, because it affects the pricing of consumer goods, however through the same process corporations would no longer be taxed by the state interpreting into lower prices to consumers. The effective change would be no change to local prices (including sales tax) in the long-term, yet encourage phenomenal economic growth as we sell exported items from Utah. We must also consider illegal aliens are now getting away with being paid cash “under the table” without any income taxes beind paid to the State, but under this plan we would now be collecting tax from these “hidden” robberies in our society. The list of possibilities goes on and on.

Regardless of your opinion, let’s get the legislature on to some serious discussion about tax reform that will finally eliminate us from double-taxation!