Friday, October 15, 2004

Tax Matters

Tennesseans get a new deduction; the Chamber of Commerce says no to the payroll tax.

Posted By on Fri, Oct 15, 2004 at 4:00 AM

In a telephone call from her office last Thursday, 7th District U.S. Rep. Marsha Blackburn hailed what she called "an enormous step forward" in the passage by the House of a tax bill which would allow Tennessee taxpayers to deduct state and local sales taxes from their federal tax returns.

By week's end, the Senate too had concurred, and the legislation -- which benefits Tennesseans along with residents of Florida, Nevada, South Dakota, Texas, Washington, and Wyoming -- was on its way to becoming law. The seven benefiting states are the ones that do not possess a state income tax but avail themselves of major revenue from sales taxes, which heretofore have not been deductible.

Besides Blackburn, a sponsor of the measure who called passage of the bill her "Number One issue," other Tennessee officeholders, past and present, could claim some credit for the outcome. They included two former legislators -- ex-U.S. representative Bob Clement of Nashville and ex-Senator Fred Thompson, each of whom had sponsored a previous version of the measure and had labored for some years to get the issue on the front burner.

Tennessee's two current senators, Lamar Alexander and Bill Frist, each hailed the outcome, as did the rest of the state's congressional delegation. Alexander credited Frist, as Senate majority leader, for his efforts in ensuring the bill's passage.

Another interested party, surely, was state senator John Wilder of Somerville, a Democrat and Tennessee's longtime lieutenant governor, who is in a tough reelection fight against Republican challenger Ron Stallings of Bolivar.

For years, Wilder has been intoning the phrase "Uncle Sam taxes taxes" as something of a mantra. The new legislation would strip Uncle of that prerogative, at least as regards the sales tax.

According to studies by the Congressional Research Service and the Center on Budget and Policy Priorities, the sales-tax deduction would provide an average $470 annually to Tennessee taxpayers itemizing their deductions. Taxpayers could also use a formula estimating the amount of their annual sales tax, based on income and household size.

In effect, the new law, which will be in effect for next spring's filings, will restore the status quo ante that existed before 1986, when tax-reform legislation of that year eliminated a sales-tax deduction as an option on federal income-tax filings.

• Speaking of taxes, the Memphis Regional Chamber of Commerce has launched a major effort to defeat next month's referendum on a proposed payroll or privilege tax.

In a memorandum late last week to "selected business/community leaders," chamber chairman-elect Gary Shorb called for an "educational campaign to assure the defeat of the proposed Privilege Tax by the Memphis City Council."

Shorb's letter, styled as an "Executive Meeting alert," reads in part: "We have gone on record in the past stating we would not oppose the generation of new revenue on a countywide basis to address the school funding issue, in particular, as long as new revenue was preceded by school funding reform, a definitive plan for debt reduction and implementation of measures to make sure government is operating efficiently.

"The Memphis Regional Chamber believes the best way to address revenue shortfalls is through efficiency and job growth. Over time, the new revenues could then be used to grow our system in strategically identified ways. The city's proposed Privilege Tax responds to none of these criteria and leaves far too many questions and issues unanswered. The last thing we want to become is less competitive in the creation of jobs and wealth in our community."

The letter urges recipients "to join the Coalition For A Better Memphis and attend an informational meeting on Friday, October 15th at 8 a.m. in Hardin Hall at the Memphis Botanic Garden."

• 9th District U.S. representative Harold Ford Jr. was the designated host for this Wednesday night's local Democratic debate-watch party -- the third and last of the 2004 presidential campaign. The Ford party was set for Jillian's on Peabody Place.

Meanwhile, the congressman's newly declared write-in opponent -- gay activist Jim Maynard -- was busy enlarging the scope of his campaign, establishing a campaign Web site, giving out campaign T-shirts, and expanding his list of issues beyond that of opposition to the Federal Marriage Amendment, which Ford supports.

Said Maynard in a news release: "This is not the first time he [Ford] has endorsed conservative positions.He has supported President Bush's 'Faith-based Initiatives,' which violate the First Amendment's anti-establishment clause and the Constitutional separation of church and state.He supported the Iraq War and wasteful military spending.I have decided that I can no longer support him or vote for him and believe that voters deserve a better choice, someone who stands up for his beliefs and principles, defends civil rights, equality, and social justice for all, and supports the separation of church and state."

• Three members of Tennessee's congressional delegation are featured in the current issue of Runner's World. Third District representative Zach Wamp of Chattanooga, 5th District representative Jim Cooper of Nashville, and 6th District representative Bart Gordon of Murfreesboro all earn space for their competitive racing efforts in a "Running for Office" issue that fronts the Democrats' vice-presidential candidate, North Carolina senator John Edwards, wearing racing shorts, on the cover.

All the Tennessee congressmen, save for Republican Wamp, are also Democrats. Clearly, competitive running is one area where the GOP needs to do some catching up. •

POLITICS by JACKSON BAKER

Ed McAteer's Farewell

Friends of longtime Christian conservative activist Ed McAteer said goodbye to him last week in a funeral service at Bellevue Baptist Church, presided over by Rev. Adrian Rogers and including testimonials from relatives and friends like Conservative Caucus founder Howard Phillips.

The 78-year-old McAteer, who had been undergoing treatment for cancer for some months, died on Wednesday morning of last week. He was active to the end, having made a point of watching the vice-presidential debate on television the night before. He had attended last month's Jones-Johnson light-heavyweight championship fight at the FedExForum and had kept on presiding over the meetings of the Dutch Treat Luncheon, a monthly forum involving local political figures.

A personal note: McAteer was the subject of my very first article for the Flyer, a 1989 cover story during the paper's first few months of publication. He and his wife Faye never ceased being friends, and I spent time with him earlier this year for another cover story. The late Dennis Freeland, the Flyer's longtime editor, and I often talked about what we both called McAteer's "irresistible" personality -- an effervescent one which transcended anybody's and everybody's politics.

There was no doubt where McAteer stood on political issues, of course -- ranging from his opposition to the U.S. surrendering the Panama Canal in the late '70s to his unyielding position against legal abortion. He was a strong voice on behalf of the state of Israel and frequently sponsored national forums and prayer meetings on the country's behalf.

McAteer was the founder of the Religious Roundtable, which mobilized the political sentiment of religious conservatives around former President Ronald Reagan. He was a Navy veteran of World War II and survived a Japanese kamikaze attack that sank his ship. After the war, he became a Golden Gloves champion in the Memphis area. Before his immersion in political and religious activism, McAteer had a successful career in business, serving as a national sales manager for Colgate toothpaste.

Undoubtedly, the toothy smile that rarely left his face was his strongest selling point. •

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