Speech
Tax Reform Plan Testimony
Remarks of Governor Judy Martz
State Capitol
2/18/2003
Senator DePratu, acting Chair Story, members of the Senate Taxation Committee... for the record, my name is Judy Martz, Governor of the great state of Montana. Thank you for providing me the opportunity to testify before you in support of the primary bill of our administration's tax reform package, Senate Bill 407 sponsored by Senator DePratu. It's great to see so many people here today to speak in support of this bill.
Last year on tax day - April 15 - I announced my Administration's plan for tax reform. In the ten months since this, we have received a significant amount of input on the plan.
I want to thank the three tax advisory councils that I appointed for their very important work.
In particular, I want to thank Senator Bob DePratu, who chaired the income tax advisory council for guiding the council in their efforts to bring forward a recommendation to make our income tax and capital gains taxes competitive.
I also want to thank Senator Story for your role in chairing the advisory council addressing the replacement tax needed to keep the plan revenue-neutral.
As you all know, economic development is the cornerstone of our administration. Business climate, including our tax structure, must be competitive. This tax reform legislation will help create the competitive business climate we need for the creation of higher-paying jobs.
As you've no doubt heard me say many times, in Montana, it is the individual income tax that is out of line, with the highest stated tax rates in the nation and the highest marginal capital gains rates in the region.
These high rates cause owners of businesses and investments to be concerned about locating and investing here. They cause business owners, farmers and ranchers to leave Montana before selling their business, farm or ranch. As you will hear in testimony from others here today, these high rates deprive Montana of jobs, investment and tax revenue.
Montana has a short-term budget crisis that we are all working to solve.
This tax reform proposal is a long-term solution, intended to improve our economy. It is aimed squarely at economic development. With a ranking of 46th in the nation in per capita income, we simply must focus on long-term job and business growth. This, in turn, will produce more revenue for the state over the long term.
We must work together to eliminate barriers to growth, allowing for the creation of better-paying jobs, that will result in additional revenue for future budgets without raising taxes on our hardworking Montanans.
This bill eliminates those major tax barriers and does so in a revenue neutral way, while still providing a tax cut to Montanans.
In the crisis of today, we cannot forget about the needs of tomorrow.
Mr. Chairman, members of the committee, we firmly believe this is the right time to implement true tax reform, for the good of our Montana families, and we are confident that this is the right proposal to accomplish that reform.
Please join me in supporting economic development in Montana - supporting our future, by supporting this bill.
Revenue Director Alme is here to discuss the specifics of the plan, and to answer any questions you may have.
Thank you.
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