A Stupid Idea – Sales Tax in The Constitution

Our Arkansas Constitution has already been amended 100 times and the legislature is considering a proposal to amend it again. What is so important they want to add even another amendment?  A ½ % sales tax for highways.

A sales tax? In the constitution? Are you freaking kidding me?

There is no good reason to put a sales tax levy in the constitution. It is only about getting some legislators to pass a tax through a proposed constitutional amendment because they intend to go back to the people and say “I didn’t vote for a sales tax increase. I just wanted the people to have the opportunity to decide.”.

We shouldn’t have a sales tax levy in the constitution where it will stay forever more. The same tax could be proposed as a simple bill. Conduit For Action opposes the tax either way, but we note that putting the tax in the constitution is worse.

  • With a statute passed by bill there could be some accountability. With a constitutional amendment the money will go to the Transportation Department permanently no matter how poorly the agency spends the money.
  • With a statute, if circumstances change and there is an urgent need for funding for some other state service, the legislature could respond by shifting some or all of the funds to the need. You can’t do that with an amendment to the constitution because it is carved in stone until revised by a new constitutional amendment.
  • If Arkansas ever gets a leader who is willing to reduce wasteful spending and thereby reduce the high cost of Arkansas government (which is higher than in most states), this ½ % sales tax would still remain in effect because it would be carved in the stone of the Arkansas Constitution.

Arkansans’ already made that mistake once.  In 1996 the people approved putting a 1/8th % sales tax in the constitution. It was sold to the people as an “environmental enhancement tax.”  The lion’s share of that tax goes to the Game and Fish Commission and since that time many hunters across the state have been complaining about the big spending of the commission and the big new Game and Fish vehicles that run up and down the highways.

Now, the Governor wants to carve another sales tax in stone, but this time for the Transportation Department which has already shown it knows how to waste money by giving a million dollars of your highway funds to the University of Arkansas for a building.

Using a statute as the basis for a section of the constitution is backwards.  Normally you think of statutes being passed based on and within the limits of the constitution.  But in this reversal, a tax in the Constitution would be based on a statute, the Arkansas Gross Receipts Tax.

To set aside money for highways you don’t need an amendment to the constitution. That is what the Arkansas budget is for.  And if you really want to take a tax and send it to a particular purpose you can do that by a simple bill.  For example, there is an additional 7/8th sales tax that is dedicated for schools that has been on the books for years and it was passed by a simple bill of the legislature.[i]

Competing legislation has already been filed to fund highways from existing taxes just by shifting where the funds go.

It is a majority vote in the legislature to levy this ½ % sales tax whether it is a vote on a bill or a vote on a resolution proposing a constitutional amendment. But there is a lot of expense involved in a constitutional amendment.  People who want more taxes so they can get swell government contracts will spend lots of money to try to pass the tax.  You know there must be lots of money already lined up, otherwise the Governor would not have pushed this idea. On the other side, the people of Arkansas who are Taxed Enough Already will spend hard earned money to oppose the tax.

The reason the Governor is pushing for a constitutional amendment has nothing to do with any need for the tax to be in the constitution. Why is the Governor pushing this extraordinary step? He can’t find enough votes to pass the tax by bill because the legislature is not willing to go on record voting for a sales tax and then have to face the wrath of the voters in the next election. The Governor thinks he can pick up enough votes if the legislature is not directly voting for the tax but is referring the tax to a vote of the people.

In other words, there are legislators who are willing to vote for the tax, IF they think they can avoid blame for the tax increase.

By referring a constitutional amendment to the people, the Governor thinks he will pick up votes from cowardly legislators who will go back home and tell you, “I didn’t vote for a sales tax increase. I just wanted the people to have the opportunity to decide.”  If your legislator makes that excuse, never trust him or her again, and make sure someone runs against the legislator and wins. You don’t need that kind of sneaky coward representing you.

HJR1018 is the number of the joint resolution to put a ½ % sales tax in the Constitution.


You can find your legislator’s contact information HERE


[i] See Educational Adequacy Trust Fund, A.C.A. § 19-5-1227 http://www.arkleg.state.ar.us/assembly/2003/S2/Acts/Act108.pdf