- The Washington Times - Tuesday, December 9, 2003

RICHMOND — Parts of Gov. Mark Warner’s tax reform package are flawed and have no chance of passing the General Assembly intact next year, particularly with a new tax reform bill already in the legislative pipeline, key legislators said yesterday.

“I don’t think the plan as laid out by the governor will pass. We collectively have to remain engaged politically to come up with a plan that can pass, and I believe that a plan can pass this year,” state Sen. Emmett W. Hanger said in a tax reform discussion at the second annual Associated Press Day at the Capitol.

The governor was scheduled to discuss his tax restructuring plan at the gathering later.

Mr. Hanger, Augusta Republican, was co-leader of a legislative panel that studied Virginia’s patchwork system of income, sales and local property taxes for five months earlier this year. He resisted the scathing rhetoric fellow Republicans applied to the Democratic governor’s tax plan in recent days.

Mr. Warner proposed a 1-cent increase in the sales tax on every dollar spent on goods; a substantial boost in the nation’s lowest cigarette tax; an increase in the income tax on Virginia’s wealthiest taxpayers with a tax cut for lower-income filers; a reduction in the tax on food; completion of the car-tax phaseout; and an end to the estate tax on family businesses and working farms.

Mr. Hanger and Delegate Allen L. Louderback, Page Republican, said that several portions of the proposal Mr. Warner introduced three weeks ago are practically flawed or politically unworkable.

“The points on where we’re going to be saving on the income tax and the food tax, we question where the dollars are actually going to come from to fund some of these things,” said Mr. Louderback, who has prefiled a tax reform bill of his own.

Mr. Hanger and John Knapp, an economist at the University of Virginia’s Weldon Cooper Center, also questioned Mr. Warner’s proposal to increase taxes on cigarettes. The Warner plan includes a tenfold boost in Virginia’s per-pack tax of 2.5 cents while localities could add up to 50 cents of their own.

“The manufacturers, the tobacco industry itself and the farm community are already prepared to accept an increase of … 25 to 30 cents a pack,” Mr. Hanger said.

“I think you will perhaps … kill the goose that lays the golden egg if you go after the governor’s proposal, which is pretty aggressive, to move it from 2 cents to, effectively, 75 or 90 cents,” he said.

A Mason-Dixon poll shows that about 69 percent of Virginians support raising the cigarette tax by 25 cents a pack.

Mason-Dixon Polling & Research conducted the poll for several Virginia news organizations. Results of the poll were published yesterday in the Richmond Times-Dispatch and the Danville Register & Bee.

The poll of about 600 registered voters was conducted Wednesday through Friday and has a margin of error of plus or minus four percentage points.

On Mr. Warner’s overall tax reform plan, the poll found 37 percent of respondents are undecided, while 35 percent favor it and 28 percent are against.

Given specifics of the plan, however, 56 percent said they would support it, 31 percent oppose it, and 13 percent are undecided.

Mr. Warner’s performance was rated excellent by 57 percent, up three percentage points from a Mason-Dixon poll in October 2002. A Times-Dispatch poll this October found Mr. Warner with a 59 percent favorable rating.

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