House Republicans defeat moratorium on tax credits/cure for Act 388 (Audio)

After more than 12 hours of budget debate, Democrats late last night launched into a proposal that would suspend all tax credits for one year, until the Tax Realignment Commission(TRAC) can submit a complete report. House Republicans now agree with Democrats that TRAC should also review Act 388, which in 2006 shifted the state’s revenue base from owner-occupied housing to sales tax.
That amendment failed 81-33.
That was followed by a 72-42 defeat of Chesterfield County Democrat Ted Vick’s tax shift proposal, which he said would take the state’s dependence away from an unstable sales tax and produce $614 million from property taxes and put $104 million into education. Property valued at $250,000 or less would pay no taxes. Those with more expensive properties would pay only on the home’s value above $250,000.
Vick said he and many other House members made a big mistake when they voted for Act 388.  He said Act 388 has caused a 27 percent reduction in state revenue over the last three years.  Vick says he meets regularly with the state’s chief economist about revenue issues, and he believes the problems are not the fault of the Board of Economic Advisers, but that the General Assembly is to blame.
(Vick on tax MP3 7:34)
Vick on tax

Concerning the proposed moratorium Newberry County Democrat Walt McLeod said we’re about to witness the unraveling of state governments, followed by local governments and school boards, within just a few years.
Richland County Democrat Joe Neal says fiscal reports currently indicate that the state has a deficit of $275 million and it will grow tremendously over the next several years.  He says the writing about the economy is on the wall.
(Neal on economy MP3 1:51)
Neal on economy
The House also stopped on an 86-24 vote a Democratic attempt to lift the $300 sales tax cap on cars, boats, recreation vehicles and planes. Charleston Democrat Seth Whipper said that removing the cap would have generated $162 million.