State and Local Tax Ballot Measures to Watch on Election Day 2019

Ballot measures are rarely what drive voters to the polls, but in many states, voters will have the opportunity to weigh in on significant policy questions when they cast their ballot on November 5th. These measures come in a variety of forms: some are referenda (placed on the ballot by the legislature); others are initiatives (the result of a citizen-led effort). Some seek to amend the constitution, others are initiated statutes, and still others are non-binding advisory measures which provide legislators with the pulse, but not the mandate, of the voting public. All are part of a tradition of “direct democracy” that varies widely from state-to-state.

Compared to last year, relatively few taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. policy considerations will confront voters in November, but of those measures that do, some are noteworthy: curtailing Colorado’s Taxpayer Bill of Rights (TABOR) protections, constitutionally prohibiting an individual income taxAn individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns. The U.S. imposes a progressive income tax where rates increase with income. The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source of tax revenue in the U.S. in Texas, legalizing and taxing marijuana and sports betting in multiple jurisdictions, and gauging the public’s approval of more than $2 billion a year in recent tax increases in Washington, among others.

The following list contains all statewide ballot measures pertaining to tax, along with select local measures from across the country. Each is summarized, with a link to further Tax Foundation analysis where available. (Additional analysis is forthcoming.)

On Election Night, the Tax Foundation will be tracking election returns for these measures live on our website. This analysis will be featured on our homepage, and this page will be updated with an election results tracking link at that time.

California

California Local Measures A in Stanton and E in Brisbane would authorize multi-rate gross receipts taxes on future cannabis businesses, with revenue going to general municipal services. Due to the gross receipts structure, the taxes would be embedded multiple times in the final price of the product. Click here for the Tax Foundation’s full analysis.

San Francisco Proposition D would impose a tax on rideshare companies at a rate of 3.25 percent for private rides and 1.5 percent for shared rides (“pooling”) and zero-emission vehicles, with revenues dedicated to public transportation and pedestrian and bicycle infrastructure.

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Colorado

Proposition CC would suspend future refunds from the Colorado Taxpayer Bill of Rights (TABOR), with the otherwise refunded revenue initially divided evenly among K-12 and higher education and transportation programs, though the legislature could change those earmarks at a later date. Currently, revenue above the TABOR growth threshold is refunded to taxpayers unless taxpayers vote to let the state retain it. Prop CC would not affect the other provisions of TABOR relating to tax rate increases. Click here for the Tax Foundation’s full analysis.

Proposition DD would legalize sports betting in casinos and online and impose an excise tax at a rate of 10 percent of net betting proceeds, projected to raise $29 million a year by fiscal year 2021. Revenue would be earmarked, primarily for water projects. Click here for the Tax Foundation’s full analysis.

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New Mexico

Albuquerque Measure R-160 would renew a 0.25 percent local sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. to continue funding transportation infrastructure. New Mexico’s sales tax is called a gross receipts taxA gross receipts tax, also known as a turnover tax, is applied to a company’s gross sales, without deductions for a firm’s business expenses, like costs of goods sold and compensation. Unlike a sales tax, a gross receipts tax is assessed on businesses and apply to business-to-business transactions in addition to final consumer purchases, leading to tax pyramiding. , and has some elements of gross receipts taxation, including a multi-rate structure, though it is closer to a general sales tax than a traditional gross receipts tax.

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Pennsylvania

Pittsburgh Parks Conservancy Tax Referendum imposes an additional city property taxA property tax is primarily levied on immovable property like land and buildings, as well as on tangible personal property that is movable, like vehicles and equipment. Property taxes are the single largest source of state and local revenue in the U.S. and help fund schools, roads, police, and other services. of 0.5 mills to generate additional funding for city parks.

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Texas

Proposition 3 would amend the constitution to permit local governments to provide tax exemptionA tax exemption excludes certain income, revenue, or even taxpayers from tax altogether. For example, nonprofits that fulfill certain requirements are granted tax-exempt status by the Internal Revenue Service (IRS), preventing them from having to pay income tax. s for properties in declared disaster areas.

Proposition 4 would amend the constitution to prohibit the adoption of an individual income tax. Since 1993, the state constitution has stipulated that an income tax can only be implemented following a vote of the people and earmarks the revenue from any such tax for education. Click here for the Tax Foundation’s full analysis.

Proposition 5 would constitutionally enshrine a provision in current law requiring that sales tax revenue generated from the sale of sporting goods is dedicated to the Parks and Wildlife Department and the State Historic Commission, requiring a two-thirds vote in both chambers to override this allocation.

Proposition 9 would exempt precious metals held in depositories from the tangible personal property tax.

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Washington

Advisory Vote 20 asks whether to retain an 0.58 percent payroll tax (which otherwise goes into effect in 2022) to fund a new Long-Term Services and Supports Trust Program to provide additional assistance and benefits to disabled individuals, expected to raise about a billion dollars per year. (Click here for the Tax Foundation’s analysis of all 12 advisory questions on the ballot in Washington.)

Advisory Vote 21 asks whether to retain a recently adopted Business & Occupation (B&O) tax surcharge on timber products. The Washington B&O is a multi-rate gross receipts tax which tends to pyramid and falls heavily on low-margin and non-vertically integrated businesses.

Advisory Vote 22 asks voters their view of a new assessment on paint products, to fund paint waste management, with an estimated 10-year revenue estimate of $6 million.

Advisory Vote 23 solicits voters’ view of the new tax on e-cigarettes and vapor products, imposed at 9 cents per milliliter (or 27 cents per ml for “closed tank” vaping systems), estimated to raise $178 million over a decade.

Advisory Vote 24 asks whether to retain surcharges on B&O tax liability for service industries, tiered based on their worldwide gross revenue, to pay for new workforce education programming, estimated to raise $2.25 billion over a decade.

Advisory Vote 25 pertains to an increase in the B&O rate on financial institutions, projected to raise an additional $1.04 billion over 10 years.

Advisory Vote 26 asks voters for their support of the state’s new, post-Wayfair remote sales tax regime, with a $100,000 gross sales safe harbor for small sellers.

Advisory Vote 27 asks voters’ opinions of a new separate rate for petroleum products under the state’s unusual “hazardous substance tax,” designed to raise $2.76 billion in new revenue over the first decade.

Advisory Vote 28 takes the pulse of the public on recently adopted legislation repealing a sales tax exemption for nonresidents who make purchases in Washington.

Advisory Vote 29 gauges voter approval of the conversion of Washington’s real estate excise tax (a transfer tax) into a graduated rate tax with a top rate of 3 percent, intended to bring in $1.75 billion over a 10-year window.

Advisory Vote 30 asks voters about their support for a B&O surtaxA surtax is an additional tax levied on top of an already existing business or individual tax and can have a flat or progressive rate structure. Surtaxes are typically enacted to fund a specific program or initiative, whereas revenue from broader-based taxes, like the individual income tax, typically cover a multitude of programs and services. on tour operators and travel agents.

Advisory Vote 31 solicits input on the recently adopted B&O surtax on international investment management services. Click here for the Tax Foundation’s analysis of all 12 advisory questions on the ballot in Washington.

Initiative 976 would limit annual vehicle licensing fees to $30 for passenger vehicles, and base vehicle tax calculations on Kelley Blue Book values rather than 85 percent of the manufacturer’s suggested retail price (MSRP), while repealing the $150 fee on electric vehicles.

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