Fact check: Does Ed Gillespie's tax plan include spending cuts?
Ed Gillespie
During an April 13 debate between three Republican candidates in the Virginia gubernatorial primary, Corey Stewart criticized Ed Gillespie's tax plan, claiming that it “doesn't cut a single nickel in spending.”[1]
Is Stewart correct that Gillespie's tax plan does not cut any spending?
Gillespie’s tax plan does not detail specific spending cuts, though it does include “cutting wasteful spending” among its proposals.[2] However, a tax plan is distinct from a budget plan that would address both tax revenue and spending levels. Gillespie subsequently released a plan to improve government efficiency that included details on spending cuts.[3]
Background
Primaries for the Virginia gubernatorial election will be held on June 13 to replace Gov. Terry McAuliffe (D), who was elected in 2013 and reached his term limit in 2017. The general election will be held on November 7.
Ed Gillespie chaired the Virginia Republican Party from 2003 to 2005. He ran for a seat in the U.S. Senate for Virginia in 2014, losing within 1 percentage point of Democratic incumbent Mark Warner.
According to his campaign website, Gillespie’s campaign themes include reducing income and local business taxes; a plan to “ensure fairness, accountability, integrity, transparency, and honesty in state government”; improving government efficiency; and a plan to “eliminate outdated regulations and tear down barriers to entry to foster greater job creation.”[4]
Corey Stewart was elected to the Prince William Board of County Supervisors in 2003 and has served as chairman since 2007. He ran for lieutenant governor in 2013 but lost at the state Republican Party’s primary convention.
Stewart’s campaign themes, according to his campaign website, include preserving historical monuments; reducing business and income taxes; increasing restrictions on illegal immigration; and reducing restrictions on gun ownership.[5]
The third Republican candidate is Frank Wagner, who has been a member of the Virginia State Senate since 2001. He served in the Virginia House of Delegates from 1992 to 2001.
Democratic candidates Ralph Northam—the incumbent lieutenant governor—and former U.S. Rep. Tom Perriello will compete in the Democratic gubernatorial primary on June 13.
According to the Tax Foundation, Virginia had the eighth highest personal income tax collection per capita of the 50 states in fiscal year 2015, the latest data available. As of January 2017, its income tax rates ranged from 2 percent to 5.75 percent.[6]
Gillespie’s tax plan
In March, Gillespie released his tax plan, the “Cutting Taxes for All Virginians Plan,” in which he outlines his proposal to cut personal income taxes by 10 percent over a three-year period, reducing the income tax range to between 1.80 percent and 5.15 percent. The plan also calls for phasing out three state-authorized business taxes enacted and collected on the local level—the Business and Professional Occupancy License Tax, the Machinery & Tools Tax, and the Merchants’ Capital Tax—within three years, providing localities the option of either reenacting them or developing new revenue streams.[7][2]
Gillespie’s plan states that his proposed tax cuts would be fully funded by revenue growth if and when revenue targets are met.[8] (The plan does not specify the target levels.) The plan says that the $1.3 billion reduction in revenue from the proposed tax cuts over five years “would still allow for more than $2 billion in new investment in education, health care, transportation, public safety, and other core services.”[2]
The plan states that revenue reductions would be offset by “cutting wasteful spending.”[2]
On May 10, Gillespie released the “Efficiency + Effectiveness: A Government that Works for All Virginians” plan, which proposes $200 million in savings over the next four years from “promoting innovation and modernizing government operations to reduce costs and improve services”; reducing the state workforce by 1,000 through attrition (leaving some positions vacated by retirement, resignations, etc. unfilled); and reducing waste, fraud, and abuse.[3] Virginia’s budgets for 2017 and 2018 were $52.4 billion and $51.9 billion, respectively.[9]
Conclusion
During an April 13 debate between three Republican candidates in the Virginia gubernatorial primary, Corey Stewart criticized Ed Gillespie's tax plan, saying that it “doesn't cut a single nickel in spending.”[1]
Gillespie’s tax plan does not detail specific spending cuts, though it does list “cutting wasteful spending” among its proposals.[2] However, a tax plan is distinct from a budget plan that would address both tax revenue and spending levels. Gillespie subsequently released a plan to improve government efficiency that included details on spending cuts.[3]
Sources and Notes
- ↑ 1.0 1.1 WSET, “GOP hopefuls for Virginia governor show varied debate styles,” April 14, 2017 (7:30)
- ↑ 2.0 2.1 2.2 2.3 2.4 Ed Gillespie 2017 campaign website, “Cutting Taxes for All Virginians Plan,” March 2017
- ↑ 3.0 3.1 3.2 Ed Gillespie 2017 campaign website, “Ed Gillespie Releases 'Efficiency + Effectiveness: A Government that Works for All Virginians' Plan,” May 10, 2017
- ↑ Ed Gillespie 2017 campaign website, “Issues,” accessed May 30, 2017
- ↑ Corey Stewart 2017 campaign website, “Issues,” accessed May 29, 2017
- ↑ Tax Foundation, “Facts & Figures 2017: How Does Your State Compare?” March 13, 2017
- ↑ Virginia Legislative Information System, “58.1-3700,” accessed May 30, 2017 See also 58.1-3507 and 58.1-3509.
- ↑ Tax Foundation, “Designing Tax Triggers: Lessons from the States,” September 7, 2016
- ↑ Virginia Department of Planning & Budget, “Virginia’s Budget,” accessed May 29, 2017
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