EDITORIAL: Governor's tax plan a good start, but need robust - not political - discussion

News-Dispatch

Gov. Mitch Daniels has gotten people talking about Indiana's 800-pound gorilla. When Daniels announced his proposal to deal with Indiana's property tax mess, it spurred the beginning of a discussion that needs to continue.

Whether Daniels' plan is adopted isn't important right now. What's important is that the governor has presented the groundwork for one of the most important issues facing Hoosiers.

Thus far the pro- and anti-Mitch factions have chimed in with predictable comments. That kind of partisanship should be left at the door in this debate. Not everything Daniels has presented ought to be accepted. By the same token, not everything the governor has proposed should be rejected, either.

The basics of Daniels' plan are laudable. He wants to cap homeowner property taxes at 1 percent of a home's assessed value beginning 2009, with limits of 2 percent for rental property and 3 percent for business property. Among the other details, Daniels said the state would assume the remaining 15 percent of school operating costs it doesn't pay for, school transportation costs and pay for care for neglected, abused and delinquent children.

His $3.1 billion property tax relief plan, however, also has a couple of red flags. The biggest one is increasing the state's sales tax from 6 percent to 7 percent, a move that if adopted, would make Indiana's sales tax the highest in the nation, joining Tennessee, Rhode Island, New Jersey and Mississippi.

That's not a place Indiana ought to consider visiting. In addition, Daniels wants to amend the state's constitution making the property tax caps he has proposed permanent. Any time discussion is held about amending the constitution, Hoosiers should be wary.

One suggestion Daniels made that deserves serious consideration is eliminating all elected assessors and replacing them with appointed assessors. Already, too many of Indiana's assessors don't have the necessary qualification and most use private assessing companies to do the work.

And the idea of referendums on large public construction projects should send a chill through those officials who persist in building Taj Mahal schools and other public facilities.

The details of Daniels' plan are sure to be debated, but as long as the debate is constructive and focused on fixing a system that is obviously broken, then all Hoosiers will benefit.