Grover Norquist and Van Taylor, August 19, 2013
All states should implement a rule like Texas, where bills must state explicitly right at the beginning whether there is a tax increase - and if so, by how much.
Does a bill raise taxes or doesn't it? It seems like a straightforward question; however, given the less than straightforward way legislation is all too often crafted in Washington and in state capitals across the country, the matter is not as simple in practice as it sounds in theory. Too often beguiling legislators hide fees, assessments, bonding authority, and even taxes in the back of lengthy bills hoping that no one will see it. This dubious practice is a bipartisan affair, with both Democrats and Republicans guilty of trying to get special provisions passed on the sly, free from scrutiny by legislative colleagues and the public.
How do we put a stop to this kind of deception? Greater transparency. In Texas we addressed the problem this year with a rule instituted at the beginning of the 2013 legislative session requiring every bill to clearly state up front whether or not it resulted in a net tax hike. One of us introduced and both championed the rule, which reads as follows:
"A house bill that would impose, authorize, increase, or change the rate or amount of a tax, assessment, surcharge, or fee must include a short statement at the end of its title or caption indicating the general effect of the bill on the tax, assessment, surcharge, or fee, such as 'imposing a tax (or assessment),' 'authorizing a surcharge (or fee),' or 'increasing the rate (or amount) of a tax.'"
What sounds like a rather simple rule had a huge impact. In Texas, we passed this commonsense reform unanimously and the effect was evident immediately. As a result of this new rule, hundreds of bills required amendments to reflect what they really did to the taxpayer. Legislators scrambled to re-file bills either by taking out the fee or tax or by changing the first line of the bill to explicitly state that a the fee or tax is created or raised by the bill.
Seems pretty basic, and who can argue against transparency and truth in advertising? Well, plenty of taxpayer-dependent special interests it turns out. Lobbyists who work for bigger government and thrive off an opaque legislative process yelled the loudest of all. After all, how could they hide their taxes and fees on line 14, page 21, of a 30 page bill if all bills were required to advertise their true fiscal impact in the first line?
Sunlight is a great disinfectant and the experience in Texas demonstrates how increased transparency helps clean up the legislative process. Lobbyists and special interests that work to siphon revenue from the private sector have nowhere to hide their parasitic provisions when a spotlight is shown on the fiscal impact of a bill. Clearly stating the truth up front makes a difference. For too long we have put up with politicians who see nothing wrong with keeping the public in the dark as to the true impact of legislation. Having to pass a bill to find out what is in it is unacceptable in this day and age and voters shouldn't tolerate it.
In 2006, Texas was one of the first states to put executive branch spending online, covering Gov. Rick Perry's office expenditures to more than two dozen state agencies. Following that, a bipartisan coalition of legislators in Austin codified government spending transparency into statewide law. Since then over 30 states have instituted similar measures. Texas led the way on transparency in government spending and we hope to see the Lone Star State lead the way on transparency in taxation.
Lawmakers in other states could do a great service to their constituents by instituting such a truth-in-taxation rule. It's important for lawmakers to know the real impact of bills they vote on and it's even more important that the public have this information so that they can hold their elected representatives accountable.