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Allred offers several tax policy changes (video)

Allred offers several tax policy changes (video)

Idaho Freedom Foundation staff
July 1, 2010

Democratic candidate for governor, Keith Allred, said that if Gov. Butch Otter had made changes to the Idaho Tax Commission and some state tax policies, public education wouldn’t be facing spending cuts.  Allred said the tax commission is understaffed and faces questions over whether people with political connections get favorable treatment.  Allred also said that some sales tax exemptions need to be closed.

Allred spoke at the Idaho State Capitol Thursday along with former Republican state Sen. Hal Bunderson of Meridian, who endorsed Allred over Gov. Butch Otter.  Bunderson, who led a Senate committee in charge of tax issues until he retired in 2006, said it’s the first time he’s backed a Democrat in an election.  He said he didn’t make the decision lightly, but that he’s more independent than many in the GOP.

Beside Allred’s stance on tax issues, Bunderson said he thinks Allred has better credentials for the top job in state government.  “He’s the superior candidate,” Bunderson said.  “If you love Idaho, you’ve got to go in that direction.”  Allred led the advocacy group The Common Interest and taught at Harvard and Columbia.  Otter, the incumbent, has served in Congress, the Idaho Legislature, been the lieutenant governor, and worked for Simplot International.

Allred outlined three changes he’d like to see to Idaho’s tax system, starting with adding workers to the tax commission, which he said has been understaffed for years.  He estimated that with more auditors over the past four years, the state could have taken in $130 million from scofflaws who intentionally or accidentally underpaid their taxes.

Allred also wants to audit the tax commission to make sure it isn’t offering sweetheart deals to people or businesses that have made political contributions.  He said the independent audits would offer needed transparency to the tax commission’s work.

Allred’s call for audits is similar to a lawsuit from Shirley Ringo over some alleged secret tax deals.  Allred said he isn’t confident that Ringo will win her lawsuit.  Allred said that policy decisions, not court decisions, can fix potential problems with the tax commission.

The third tax change Allred wants to see is an examination of sales tax exemptions that totaled $1.7 billion in potential revenue last year.  The sales tax brings in $1.2 billion a year.  Allred said some of the sales tax exemptions are worthwhile, but wouldn’t say if there are any specific exemptions he’d like to get rid of.

Rather than put specific exemptions on the cutting block himself, Allred would use the Internet to gather input from taxpayers across the state.  Allred said having more people discuss the tax exemptions would lead to a different result that leaving it up to lawmakers.

Allred said those three measures would add fairness to Idaho tax policy.

Bunderson backed Allred’s ideas, saying closing some sales tax exemptions and hiring more auditors won’t add to taxpayers’ burden.

Otter’s campaign rejected the suggestions from Allred.  Debbie Field, Otter’s campaign director, said the Legislature has approved adding some staff to the tax commission in the last year to catch people underpaying their taxes.  So far, that added staff has brought in money that should have been paid, and Field said that will continue, though the commission will be held accountable to make sure there isn’t a diminishing return with the extra staff.

Field said Allred should take a stand on which exemptions he’d like to see removed.  “It’s pretty easy to stand there and say ‘I’m going take a poll before I’ll let you know which ones I’ll (cut),’” she said.

She also disagreed with Bunderson’s assessment of Allred’s résumé.  “He could have all the education in the world and not understand what it takes to balance a budget,” Field said. “You have to know how to manage people, you have to know how to manage the budget, and I haven’t seen that coming out of Keith.”

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