2018 Election Review: Tax Ballot Measures

Ballot measures are one of the easiest ways for the electorate to have a direct say in policy, and there was no shortage of opportunities for voters to weigh in on tax policy in the states this year. With more than 30 tax-related ballot measures in 18 states, several themes emerged among voters. Ultimately, voters proved to be wary of tax increases, approving many legislative limits on taxing authority, defeating almost every direct tax increase on the ballot, and approving many tax exemptions. Major trends are grouped below, followed by a table of complete tax ballot measure results. For a description of each ballot measures, see our pre-election analysis.

Authority to Levy New or Increase Taxes

Proposals to limit legislative authority to levy new or increase taxes in some way were popular this year. These proposals appeared in sixteen ballot measures, and nearly seventy percent of them passed.

Passed:

• Arizona Proposition 126 passed, prohibiting the future taxation of services.
• Florida Amendment 3 passed, giving voters the exclusive right to approve casino gambling in the state.
• Florida Amendment 5 passed, requiring a supermajority of two-thirds of each chamber to enact new taxes or raise existing ones.
• Georgia Amendment 5 passed, amending the constitution to allow a school district or group of districts to call for a 1 percent sales tax referendum.
• North Carolina’s Income Tax Cap passed, lowering the state’s maximum individual income tax rate cap from 10 to 7 percent.
• Washington Initiative 1634 passed, prohibiting local groceries from levying any new taxes on groceries, including soda.
  

Failed:

• California Proposition 6 failed, so last year’s 12-cent-per-gallon gas tax will stay in place, and voters will not be required to approve new gas tax increases going forward.
• Oklahoma State Question 801 failed, preventing an amendment to the state constitution that would have allowed certain local, voter-approved property taxes to fund school district operations.
• Oregon Measure 103 failed, so there will not be a prohibition on the state and local taxation of groceries, including soda, going forward.
• Oregon Measure 104 failed, so the state’s current three-fifths supermajority requirement to increase taxes will not be expanded to apply to reductions in tax credits, exemptions, and deductions.

Tax Increases

Passed:

• Montana LR-128 passed, extending the life of the six-mill tax on real estate and personal property.
  

Failed:

• Colorado Amendment 73 failed, retaining the state’s current corporate and individual income tax structure and rates.
• Maine Question 1 failed, striking down the proposed 3.8 percent payroll tax on income above the social security threshold.
• Missouri Proposition D failed, keeping the gas tax rate at its current 17 cents per gallon.
• Montana Initiative 185 failed, rejecting a cigarette tax increase of $2 per pack.
• South Dakota Measure 25 failed, rejecting a cigarette tax increase of $1 per pack.
• Utah Non-binding Question 1 failed, so voters sent a message that they would not approve of a 10 cents per gallon gas tax increase.

Tax Exemptions

Passed:

• Florida Amendment 2 passed and the 10 percent cap on nonhomestead parcel assessments is now permanent.
• Georgia Referendum A passed, providing for a homestead exemption for certain narrowly defined municipalities, like those in the Atlanta area, in Georgia.
• Louisiana Amendment 5 passed, creating a constitutional amendment in Louisiana that will allow a special assessment on specific properties in trust, such as those for disabled veterans or the surviving spouses of those who died while performing their duties as first responders, active duty military, law enforcement officers, or fire protection officers.
• Nevada Question 2 passed, exempting feminine hygiene products from the state’s general sales tax.
• Nevada Question 4 passed, exempting durable medical equipment, oxygen delivery equipment, and mobility enhancing equipment from the state’s general sales tax.
• Utah Constitutional Amendment A passed, tweaking the state’s existing property tax exemption for active duty military members.
• Virginia Question 1 passed, expanding the state’s existing property tax exemption for surviving spouses of disabled military veterans.
• Virginia Question 2 passed, authorizing the state legislature to allow local governments to provide a partial local property tax exemption for property subject to recurring flooding if there are efforts to improve or mitigate flooding problems.

Failed:

• California Proposition 5 failed, so Proposition 13’s benefits will not be extended to allow eligible homeowners to transfer the adjusted tax-assessed value from their previous home to their new home, regardless of the new home’s market value, location, or the number of moves.

Utah Constitutional Amendment B failed, defeating a constitutional amendment that would have created a property tax exemption for real property that the state or local government leases from a private owner.