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Sponsor asks voters whether surplus income taxes should be returned automatically; policy groups urge caution
Summary
Representative Caleb Hinkle asked the House Taxation Committee to send a question to Montana voters on whether the legislature should create an automatic system to return excess income-tax revenue.
Representative Caleb Hinkle introduced House Bill 3 27, a legislative referendum bill that would ask Montana voters whether the legislature may establish a program to return excess revenue to resident income taxpayers.
Hinkle said the idea arose during his campaign after conversations with constituents about ‘‘over collected’’ income taxes. He told the House Taxation Committee the bill is a request that the electorate consider an automatic return mechanism — not an immediate change to tax law — and cited Colorado’s Taxpayer Bill of Rights as an example of voter-directed limits on revenues and refunds.
Opponents told the committee they are concerned an automatic return mechanism would tie the hands of future legislatures during economic downturns. Rose Bender of the Montana Budget and Policy Center urged members to oppose HB 327, saying ‘‘policies like this that prevent future legislatures from making educated decisions about state revenues that could consider economic conditions at the time are inadvisable.’’ Kelson Young of the Montana Coalition Against Domestic and Sexual Violence said many public-safety and social-service programs rely on general fund dollars and cautioned against removing legislative discretion.
Committee members asked technical questions about the bill’s legal mechanics; the sponsor acknowledged the proposal was an ‘‘ask’’ to voters and said any implementation details would be addressed by a future legislature if voters approved the referendum. Members also discussed whether to request further legal review; staff said bills receive legal review during drafting and that legal-review documents appear on the bill’s additional documents if prepared. No committee vote on HB 327 occurred during the hearing.
Ending: The hearing ended with committee members seeking additional clarity on potential legal and fiscal mechanics if the referendum were to be approved. Because HB 327 is a legislative referendum request rather than an immediate statutory change, witnesses emphasized that any implementation would require subsequent legislative action if voters approve the measure.
