Supreme Court Ruling Opens Door to Millions in New Taxes

by CTBC Director | 11:57 pm, April 9, 2009 | Comments Off

The Colorado Supreme Court’s recent ruling to sanction Governor Bill Ritter’s backdoor tax increase on the people of Colorado (the so-called Mill Levy Tax “Freeze”) - overturning both the trial court who had found the tax increase unconstitutional and the will of the people, as previously expressed by rejecting a nearly-identical measure to freeze Colorado’s mill levy tax rates (Amendment 32) - was bad enough, costing Colorado taxpayers over $117 million this year alone.

BUT WAIT, THERE’S MORE: additional language buried deep “in the middle of the 45-page opinion” opens the door to millions more - up to $2 Billion more - in additional taxes, without asking voters for their permission, as required by TABOR.

State Legislature staff lawyer Sharon Eubanks briefed the Joint Budget Committee “with her shocking analysis of [the] recent state Supreme Court decision, which she says gives legislators the right to raise taxes without a vote of the people.” 

John Ziegler, staff director of the Joint Budget Committee, then provided legislators a list of several tax credits that were now “fair game” under the interpretation - totalling almost $2 Billion in potential “new” tax revenue.  (Just for fun - review the list and see how many new taxes YOU might get to pay once the legislature puts them into effect (take the survey and/or post comments below).  I tallied up 6-9 additional taxes I would have to pay, depending on how I spend my week - but I’m not a smoker   (although I DO buy groceries, gas, use the internet, a cellphone, etc.).

Of course, if you are a smoker, it didn’t take long to become the first target for new taxes.  Within a few short hours after hearing the legal analysis,

“the JBC made its first move to take advantage of its possible new power.  Rep. Mark Ferrandino, D-Denver, asked the JBC to sponsor a bill to repeal a cigarette tax exemption, and the panel agreed.

In 1969, the Legislature exempted cigarettes from sales taxes, even though they are still subject to an 84-cent-per-pack state excise tax and a $1.01 per pack federal tax.  The sales-tax exemption is worth $30 million a year.“

Outraged yet?  You’re not alone.  House Minority Leader Mike May, R-Parker, issued a “harshly worded statement” condemning the ruling:

“The Constitution is not a book of suggestions, it is the law.  I’m astounded at the arrogant presumption of authority over an area of the budget long thought to be clearly marked off limits by the Constitution.  Particularly at a time when Colorado taxpayers are tightening their belts, we should be doing the same before we take more of their money.  I believe that much more thought should have been given to this opinion before we embark on going into such uncharted territory.“

Vince Carroll of the Denver Post editorial board weighed in with a scathing essay (Blowing the Lid Off TABOR) slamming the court:

“Maybe it truly didn’t realize how its ruling last month justifying a property tax grab by state officials sets up Coloradans to be nibbled to death by one tax hike after another.“

Forgive them, for they know not what they do?  Not so much.  Sen. Al White, R-Hayden, indicates that the Supremes (particularly ueber-partisan Chief Justice Mullarkey, who wrote the opinion) knew exactly what they were doing:

“I suppose there could be a lawsuit, but a lawsuit on a Supreme Court ruling will end up right back at the Supreme Court.“

Jon Caldara, president of the Independence Institute, expressed similar sentiments:

“The Supreme Court will back the Legislature if it wants to repeal tax credits…

What lawyer would recommend us to go through (with a lawsuit) when you’ve got a Supreme Court that is willing to redefine words to defeat TABOR?

Instead of spending money for lawsuits, it might be better to spend the money on efforts to remake the court.

‘At some point, something’s got to be done to bring the courts back into line with the law.  I’m not sure what it is,’ Caldara said.

Indeed - something’s got to be done. 

Vote NO on retaining the four rogue Supreme Court justices - Mullarkey, Bender, Martinez, and Rice - in 2010.

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