Tennessee’s Tax Reform Problem During the last couple months ,Tennessee’s Governor Don Sundquist, has been trying to resolve a major problem brewing in Tennessee. The proposed budget for theState of Tennessee has a budget shortfall of $382 million dollars. Representatives inNashville have been working vigorously to find a way to fix the deficit. Governor DonSundquist wants to impose a state income tax to meet the budget deficit. The state ofTennessee has a rather outdated tax system(1999, paragraph 3). The tax system wasdeveloped in the 1920’s, and was primarily based on sales taxes (1999, paragraph 6).The problem that Tennessee has ran into time and time again, is that when theeconomy is down, then state spending is cut drastically ( 1999, paragraph 18). The citizens of Tennessee have been outraged by this proposal. Professor ofUTC, J.R. Clark says that income tax is not the answer for the budget shortfall (NewsFree Press, 1999). Although, a UTK professor of economics suggests that an stateincome tax is the only solution to the budget problem ( News Free Press, 1999).Anti-tax citizens are wanting the government to cut the state’s spending. Governor DonSundquist says, “Our tax system is out-dated. It was designed in the early and middledecades of this century; it is poorly suited to our state’s needs and to our citizen’s senseof fairness.” Recently, a tax study was launched statewide to see how the citizens feelabout a state income tax.(1999, paragraph 21). So far, the tax study sessions haveheard views only of citizens supporting a new tax system. Many people agree thatTennessee is falling behind other states, and that there is a major need for reforming Tennessee’s tax system. Many citizens are wondering where Tennessee is spendingall the tax money. Out of each tax dolllar that they collect, twenty-four cents goestoward health and social s...
