Brewer defends tax hike to business owners - East Valley Tribune: Arizona

Brewer defends tax hike to business owners

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Posted: Friday, June 18, 2010 9:39 am | Updated: 12:07 pm, Fri Aug 13, 2010.

Gov. Jan Brewer took her case for why her administration has been good for business to southern Arizona on Thursday.

But she told an audience of business owners, managers and executives that doesn't mean she's going to approve a massive tax cut.

In a wide ranging speech to members of the Tucson Metropolitan and Marana chambers of commerce, the governor said the policies of her administration since taking office in January 2009 have been "real conservatism, conservatism that is pragmatic, sound, responsible, honest, tough and thoughtful, one which understands government is not the answer to all of our woes.''

The governor defended her support of Proposition 100, approved by voters last month, to hike the state sales tax by a penny, to 6.6 percent, for the next three years.

"I understand the honorable position of those who opposed the temporary tax increase, including perhaps even some of you here today,'' Brewer said. The governor said she shares the sentiment of some foes who recognize the higher tax "isn't a cure-all,'' with the state still facing a $1 billion deficit for the 2011-2012 budget year.

It is that anticipated deficit, the governor said, which is why she will not support a package of massive tax cuts.

The House earlier this year approved a plan to cut corporate income taxes by about 28 percent, provide a 10 percent across-the-board cut in individual income tax rates, eliminate the state property tax and cut what businesses pay in local property taxes.

House Speaker Kirk Adams, R-Mesa, produced an economic study saying that would spur economic development and create new jobs.

But the plan ran into trouble when legislative budget staffers pegged the cost at $950 million annually when fully implemented.

Brewer refused to consider even a scaled back plan. The governor said Thursday she remains committed to business tax cuts -- but nothing like this.

"I support a responsible package to spur job creation and our state's economic recovery,'' Brewer said. "But it must be a package that the state can afford.''

She told her business audience she is willing to work with them on a "sensible jobs package that is affordable and linked to job creation.''

The governor has said she favors giving breaks to companies only when they actually bring new jobs to the state, rather than giving all firms lower taxes in hopes that will stimulate the economy.

But Brewer still faces opposition from within her own party to that narrower approach. Sen. Frank Antenori, R-Tucson, in his turn to talk to the audience, urged Brewer to call a special legislative session to enact the tax cuts before the end of the year.

Brewer, acknowledging she is being challenged from within her own Republican party for the gubernatorial nomination, said voters should ignore how others describe her.

"I am Jan Brewer who has changed everything about state government: its priorities, its spending habits, its size and its culture,'' she said.

Brewer also said she believes the greatest thing the government can do for business "is create an environment of stability and predictability.'' She said that includes working toward balanced budgets, avoiding greater debt and fostering an educated workforce.

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