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Question of the Month ~ March 2011

 

Q. Which states require supermajority votes in the legislature to pass tax increases?
As most states continue to struggle to balance their budgets, state lawmakers will be weighing tough decisions regarding spending cuts and tax increases. In a number of states, increasing taxes takes more than gaining the simple majority vote required to pass most legislative proposals.
According to Americans for Tax Reform, entering this year, 16 states required a supermajority vote for taxes to be raised. Known as “tax limitation amendments,” these rules require majorities of two-thirds, three-fifths, or three-fourths of votes in each chamber of the legislature in order to pass a measure that would result in a tax increase.
Wisconsin recently joined those states that have a supermajority requirement of some kind. Signed into law in February, AB 5 requires a two-thirds vote in both legislative chambers for an increase in the sales tax, income tax or franchise tax to be advanced to the governor. A separate measure (SJR 8) has been introduced that would make the supermajority requirement constitutional.
In North Dakota, HCR 3023 calls for the consideration of a constitutional amendment requiring that any increase to the state’s sales, income, use or motor vehicle taxes pass with at least a 60 percent vote by each chamber. If approved by the legislature, the measure will appear on the November 2012 ballot.
South Dakota is one of seven states — along with Arizona, California, Colorado, Louisiana, Nevada and Washington — that already had a two-thirds supermajority requirement entering the new legislative year.
Four states — Delaware, Kentucky, Mississippi and Oregon — require a three-fifths majority vote. Lawmakers in Arkansas and Oklahoma face the most restrictive tax limitation amendment, which calls for three-quarters of lawmakers’ votes to pass a tax increase.
Michigan, Florida and Missouri have supermajority requirements that apply to very specific tax adjustments.
Michigan requires three-quarters of the Legislature to vote for any adjustment to state property tax assessments, and Florida’s three-fifths supermajority requirement applies only to corporate tax increases.
In Missouri, a tax increase exceeding the revenue limit — the state restricts taxation based on a formula tied to growth in personal income — must first receive a declaration of emergency by two-thirds of the members of the legislature.
In most states, tax limitation amendments are constitutional rather than statutory requirements. Advocates of requiring supermajority votes for tax increases prefer the constitutional-amendment route, arguing that legislatures can simply negate or change a statutory voting threshold for a tax increase with a simple majority vote in both chambers. Constitutional requirements are less easily reversed.

 

This article was written by Laura Tomaka, program manager for the CSG Midwest office.

 

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The Council of State Governments is the nation's only nonpartisan association of state officials serving all three branches of government in all 50 states and the U.S. territories. CSG is a regionally-based, national organization that promotes excellence in state government. CSG fosters the interstate exchange of insights and ideas to help state officials shape public policy, and it offers unparalleled regional, national and international opportunities to network, develop leaders, collaborate and create problem-solving partnerships. CSG Midwest focuses on meeting the needs of state policymakers and leaders in the nation's heartland, including 11 Midwestern states.