- The Washington Times - Tuesday, October 2, 2001

Gubernatorial candidate Mark L. Earley is trying to recapture the tax issue that has delivered victory to so many other Virginia Republicans, introducing a new television ad yesterday and holding a news conference to draw a line between him and his opponent, Democrat Mark R. Warner.
"The very first budgetary proposal that Mark Warner makes in this campaign relies 41 percent worth on a $900 million sales-tax increase. That's a big difference. He is proposing a tax increase. We are opposing a tax increase," Mr. Earley told reporters at the news conference in Richmond.
But in response to reporters' questions, Mr. Earley would not rule out signing a similar tax increase, which would come from a referendum to raise the sales tax in Northern Virginia to pay for transportation projects. Mr. Earley said he wants to keep an open door to lawmakers who are pushing for the referendum.
Thus goes the tax debate in Virginia this year, as both candidates walk a fine line on the referendum.
Mr. Earley makes public statements about keeping an open door on the issue, then seems to turn and wink at his hard-line tax opponent supporters, expecting them to read between the lines.
Those supporters want him to follow the lead of current Gov. James S. Gilmore III, who made it clear a tax-referendum proposal would be dead on arrival at his desk. But Mr. Earley also doesn't want to be seen as intractable as Mr. Gilmore has seemed to lawmakers on keeping his pledge to cut the car tax, which led to a stalemate over amendments to the state's budget in the legislature this year.
Mr. Warner, meanwhile, says he won't raise taxes, but says he's open to the referendum. He is counting on bonds paid for from the tax increase to make up part of the $2.25 billion transportation plan he announced last month, and business leaders in Northern Virginia say his support for the referendum is all that distinguishes his transportation plan from Mr. Earley's $1.8 billion plan.
Mr. Warner says being open to the referendum isn't the same as supporting the tax increase, and in a telephone news conference with reporters yesterday a representative for the Warner campaign described it as support of local control, not as support of tax increases.
"It simply is not Mark Warner raising taxes, it's Mark Warner listening to the people and trusting them," said Delegate Anne G. "Panny" Rhodes, Richmond Republican, who has crossed party lines to support Mr. Warner.
The debate is happening in the shadow of Virginia's most dedicated tax cutter, Mr. Gilmore, whose "no car tax" pledge seemed almost magical for three years as it helped him and dozens of other Republicans win office. But last year's budget stalemate the Republican-controlled Senate balked at keeping the car tax on schedule, arguing the money was better spent on other state services has diminished the tax cut's support among local governments and public employees.
Still, the fifth and final stage of phasing out the car tax is due next year, and earlier in the race Republicans had hoped to use that as a wedge against Mr. Warner. But now Mr. Earley says he can't guarantee keeping the tax on schedule, given post-Sept. 11 security concerns, and Mr. Warner has mitigated the issue by saying he'll finish the car tax by the end of his term, if not next year.
The back-and-forth comments are the basis of the two candidates' current dueling television ads. As of yesterday Mr. Earley is running two ads, the first accusing Mr. Warner of wanting to raise taxes and the second responding to Mr. Warner's own response ad in which Mr. Warner says Mr. Earley is distorting his position.
"He's in the position of backsliding, we're in the position of reaffirming our opposition to tax increases," said Christopher LaCivita, a senior advisor to Mr. Earley's campaign.

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