Proposition 100 aims to keep Arizona from adding real estate sales tax

With BC-CNS-Prop 100-Box

By GREG LINDSAY
Cronkite News Service

PHOENIX _ Supporters of a ballot proposition that would prohibit state and local governments in Arizona from adding a tax on sales of homes, farms and other real property say it would spare citizens from double taxation.

Opponents say Proposition 100 would unnecessarily restrict the ability of governments to determine the best way to provide for the state’s rapid growth.

As of 2004, 35 and the District of Columbia imposed a tax on the transfer of real property, producing about $7 billion, according to a report by the Washington, D.C.-based Federation of Tax Administrators. In all but seven states and the District of Columbia, the tax was 1 percent or less. In some states, such taxes are imposed at the local level.

The proposition was put on the ballot by a group calling itself the Protect Our Homes Coalition. The group’s primary financial sponsors are real estate agents, according to records filed with the Arizona Secretary of State’s Office.

Steve Roman, a spokesman for the Protect Our Homes Coalition, said Arizonans should be protected from ever facing such a tax because they already pay property taxes. He said real estate agents are leading the effort because they are intimately aware of the impact such a tax would have on keeping property affordable.

“This is clearly taking something off the table,” Roman said. “If the government is looking to build revenue, don’t put it on the backs of property owners; they are already paying taxes.”

John Wright, president of Arizona Education Association, said the proposition would stifle governments’ ability to discuss potential tax changes.

“It is an abuse of the Constitution; that’s what the Constitution is there for,” Wright said. “It protects our right as citizens to discuss these issues.”

Sandy Bahr, conservation outreach director of the Sierra Club’s Grand Canyon Chapter, said her group opposes Proposition 100 because it could wind up costing tax revenue that could be used for important projects such as conservation programs. She noted that Florida has used its real estate transfer tax to preserve land.

“Cutting off this source, and then putting it in the Constitution, is ridiculous,” she said.

Joe Sigg, director of government relations for the Arizona Farm Bureau, said citizens are having a conversation about the need for such a tax by voting on the proposition.

“Our position is that we just need to close the debate on an additional property tax on agriculture,” he said. “It’s a pocketbook issue; real property issues drop straight to our bottom line.”