- NFIB - A preview of the emerging trends and key issues from the midterm elections' slate of ballot measures: A preview of the emerging trends and key issues from the midterm elections' slate of ballot measures. On Nov. 6, voters will head to the polls to decide who will represent them in their statehouses and in Washington, D.C. In 38 states, voters will also weigh in on a total of 157 ballot initiatives. Through the ballot initiative process, the National Conference of State Legislatures explains, citizens are able to bypass the state legislature and take proposed laws and constitutional amendments directly to the public by placing them on the ballot for a statewide vote. According to Ballotpedia, among the 157 ballot initiatives that will be decided in November, there are several small business issues addressed multiple times, including:
- Elections policy
- Tax restrictions
- Medicaid expansion and healthcare
- Energy policy
- Minimum wage
Tim Goodrich, NFIB’s Executive Director of State Government Relations, also noted that it’s a growing trend for labor and environmental groups to take their proposals to the ballot to attempt to secure the results they haven’t been able to accomplish legislatively. The results of these ballot measure votes have the potential to affect small business owners significantly, and NFIB is engaged on many of them. Here’s a look at four of the most important ones. Read ballot measures here in California, Oregon, and Washington.
- Washington Voters Might Ban Local Grocery Excise Taxes, Including Soda Taxes: Groceries are already excluded from the sales tax in Washington State, and a pending ballot measure, Prohibit Local Taxes on Groceries Measure (Initiative 1634), won’t impact whether that ever changes. What it would do, though, is prevent localities from adopting new taxes on groceries–or certain grocery subcategories–independently of the state. Although it technically applies more broadly, in practice, it’s best to think of this as statewide voter preemption of new local soda taxes. In the past, Washington courts have held that local governments can only impose taxes expressly authorized by statute. That’s been a constraint on many local tax initiatives, but not on soda taxes, because Washington localities do have excise tax authority. In January of this year, Seattle became one the few cities nationwide to impose a soda tax, levied at 1.75 cents per ounce (about $1.18 for a two-liter bottle). The average Washington household purchases 102 liters of sugar-sweetened beverages per year. At 1.75 cents an ounce, that adds up to more than $60 in soda taxes each year. Meanwhile, 47 percent of sugar-sweetened beverages sold are purchased by households making less than $50,000 a year. Read more at the Tax Foundation.
- Iowa tax receipts expected to grow, then slow: Changes in federal and state tax policies as well as overall economic strength prompted state officials Tuesday to bump up their growth projections for Iowa tax collections to 4.9 percent this fiscal year, but then scale back their estimate to a 1.7 percent increase in fiscal 2020. The three-member Revenue Estimating Conference added $101.7 million to its current-year projection of $7.742 billion, building expectations the state will collect a total of an extra $358.2 million over the previous year by June 30, 2019. The panel’s estimated increase was fueled in part by a windfall that’s due to federal tax cuts translating into higher state revenue. Iowans will have less to deduct from their federal taxes when calculating what they owe the state. Read more at the Gazette.
- Many Utahans still face bigger state income tax bill, lawmakers told: Lawmakers showed new interest Wednesday in tackling what for many Utahns may be a significant increase in their state income taxes as a result of the $1.5 trillion federal tax cut package. Members of the Legislature's Revenue and Taxation Interim Committee were told Utahns with large families will still owe as much as an additional $1,231 on their 2018 income after a $30 million tax break and a rate cut from 5 percent to 4.95 percent. It's going to take another $153 million to fully restore the deduction for dependents that was eliminated in the tax changes made by Congress in December 2017, legislative economist Thomas Young said. That's because the tax break passed by lawmakers in a special session last July only amounted to adding back $565 of what would need to be a $3,113 deduction to totally offset the impact of the federal changes, Young said. Those numbers, as well as calculations presented by a tax preparer who showed an example of a family with four children seeing their state tax bill jump $549 from the previous year to nearly $4,500, seemed to surprise some on the committee. Read full article at Deseret News.
- Nevada businesses to get tax cut: Nevada businesses will get a tax cut next year because collections from the business and commerce taxes both came in significantly higher than projected. Under state statute, those taxes are allowed to grow by up to 4 percent a year but, if they exceed that, the Department of Taxation has to lower the rate they pay for the Modified Business Tax to reduce next year's revenues to what would've been 4 percent growth. Taxation Director Bill Anderson told the Economic Forum on Thursday the state collected $786.5 million from the 1.475 percent MBT, the 2 percent MBT on mining and financial institutions, the commerce tax and bank branch excise tax. Anderson said that's 10.1 percent or $72 million more than the $714.5 million they were projected to bring in. He said adding 4 percent to that projection caps what those taxes were allowed to bring in at about $743 million so rates must be lowered to return the excess to businesses. For the 2020 fiscal year, he said, the department will reduce the general business rate from 1.475 percent to 1.378 percent. The 2 percent mining/financial rate will be cut to 1.853 percent. Read more at Nevada Appeal.
Missouri: Gas Tax, Minimum Wage, Cannabis Top Ballot Issues — Voters Statewide to Decide: The successful passage of Proposition A in August proved taking an issue directly to the voters of the state of Missouri may be the best way to handle controversial measure that has languished in the General Assembly for years. At that time, voters shot down the Right to Work movement by a substantial margin and overturend legislation passed by the General Assembly the year before. That legislation would have allowed workers at union companies to be employed and not join the union. To put the power into the peoples’ hands even further, the initiative was placed on the ballot after a signature drive across the state. On Nov. 6, Missouri voters will again get a direct say on three similar signature-backed propositions are on the ballots. Read more at EMissiourian.
FOOD & BEVERAGE NEWS
Franchonomics - Our view: The comptroller has some curious views on the relationship of price and demand when it comes to alcohol, unless it suits him to contradict himself: In a recent meeting with The Baltimore Sun’s editorial board, Maryland Comptroller Peter Franchot offered an opinion with which we — and most reasonable observers — would disagree. Responding to a question about alcohol sales, the state’s chief tax collector said that raising taxes on alcohol (as Maryland did by increasing the sales tax on such beverages in 2011) had no impact on consumption despite the resulting price increase. None. Advocates who claim otherwise, he said, are simply mistaken. Read full story here.
- DC Sports Betting Regulators Tell Council They Could Have Product Live In Early 2019: Washington, D.C. residents are hungry for sports betting, district regulators say it can be running four months after a bill is passed. The Committee of Finance and Revenue heard testimony Wednesday from several gambling stakeholders including representative from MGM Resorts International, NBA, FanDuel and DraftKings. Beth Bresnahan, executive director of the lottery, said it would take four to six months to start sports betting once a law is in place. The hearing was scheduled to review the “Sports Wagering Lottery Amendment Act of 2018,”authored by Councilmember Jack Evans. It would permit sports wagering at licensed establishments around the district as early as next year. A spokesman for Evans said if everything goes as planned, the bill could be on the mayor’s desk by Thanksgiving. Any DC bill signed by the mayor must go to Congress for a 30-day review. If a disapproval resolution is passed by the House and Senate, then the DC bill is overturned, unless the resolution is vetoed by the president. However, if a bill goes to the House and is not acted upon in 30 days, then the bill is enacted. Read more at Legal Sports Report.
Illinois Sports Betting Takes Center Stage In Gambling Expansion Hearing: State lawmakers from two House subcommittees gathered in Springfield on Wednesday for a second hearing on gambling expansion including Illinois sports betting. The first, held in August, created the foundation for this deeper dive, with stakeholders from across the landscape offering perspectives. New casinos, online gambling, daily fantasy sports and sports betting were all on the table, but the latter dominated the conversation. Read more and the backstory here.
LABOR POLICY NEWS
- Bloomberg Government - New Jersey Employers Scramble Ahead of Paid Sick Leave Law: New Jersey employers hope to contain last-minute chaos as they hustle to implement proposed guidelines for the state’s new paid sick leave law. The law kicks in Oct. 29. Employers need programs and processes in place to ensure that workers can start accruing sick leave by then. Gov. Phil Murphy(D) signed the New Jersey Paid Sick Leave Act (A1827) in May, and New Jersey’s Department of Labor and Workforce Development released proposed rules last month. The regulations are in a 60-day comment period that ends Dec. 14, and they likely won’t be finalized until the end of the year or early next year. “The law is certainly well-intended, but the way it’s currently drafted, it creates a lot of problems for a lot of employers,” attorney Alvaro Hasani told Bloomberg Law. Hasani is a management-side associate on labor and employment in the Murray Hill, N.J., office of Fisher Phillips LLC. Under the law, workers accrue one hour of paid sick leave for every 30 hours worked, and the statute preempts any county or municipal ordinances, resolutions, laws, rules, or regulations on earned sick leave. Once the law goes into effect, 13 local ordinances across the state will be pre-empted, giving employers just one set of rules to follow.
- Legislative Victories and Many Challenges Ahead for Small Businesses in California: With Governor Jerry Brown’s final bill signature/veto deadline in our rear-view mirror, and the upcoming election of a new Governor and legislature just around the corner, now is an important time for small business owners—and all California taxpayers—to reflect on some of the greatest victories from this past session and important challenges ahead in the coming new year.
From looking at overhauling our tax code with a new sales tax on services to considering numerous employer mandates to address sexual harassment in the workplace, 2018 was anything but a slow legislative year for the employer community. And while the next Governor and legislature will potentially consider sweeping policy issues such as a multi-hundred-billion-dollar single payer health care system, or taking on Proposition 13 tax protections with split roll, below are some of the key legislative issues small businesses faced this year in California. Read more at Fox and Hounds Daily.