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Election 2020: States With Tax Questions on the Ballot

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This election will be a vital one for millions of American voters, not just because it's a presidential election year, but because voters in 32 states, the District of Columbia and the U.S. territories will be asked by November 3 to weigh in on a variety of issues that directly impact their communities in the form of ballot initiatives. For those who question the importance of standing in line for upwards of hours to vote, consider this: Ballot initiatives enable citizens to cut through the red tape of the lawmaking process and have a direct say on issues that affect their communities and their pocketbooks.

As millions of citizens are already heading to the polls before the November 3 general election, voters in 17 states are being asked to cast their vote on a bevy of proposed tax law changes. This year, several states are voting to legalize – and tax – marijuana, while voters in Colorado and Oregon will decide whether or not their states should increase taxes on tobacco and e-cigarettes to fund state-run health programs. Alaskans will, for the first time, decide to impose a tax on oil producers who drill in the northern reaches of The Last Frontier.

Even if your state doesn't appear on the list, keep your eyes open for what's being proposed because you could see a similar tax measure in an upcoming ballot in your state as states are known to replicate policies from other states whose policies were successfully approved. But keep in mind that voter approval doesn't necessarily translate to action. Some initiatives are purely meant to be advisory (e.g., Washington state's tax questions), and sometimes legislators or executives just plain disagree.

Voters in the 17 states listed below will see statewide, tax-related questions on this year's ballot. Take a look and see what residents in these states will decide when they cast their vote on November 3.

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Alaska's sole tax-related ballot measure for the 2020 general election, if approved, would raise taxes in large oil production fields in the North Slope region, home to Point Barrow and Prudhoe Bay. Under Ballot Measure 1, three oil fields that have a lifetime output of at least 400 million barrels of oil and had produced at least 40,000 barrels daily last year would be subject to the tax hike. State legislators predict that the initiative would extract more than $1 billion annually from oil drillers such as ConocoPhillips. What's more, the ballot measure adds a provision that makes those oil companies disclose their proprietary financial information to the public.

That such a cold, remote region of the state could be at the center of a such a hot issue between Alaskan voters and big oil producers is no surprise to those who have been debating taxing producers in the North Slope since drilling began there in 1977. For the first time in Alaska's state history, voters, not legislators, will have the power to decide with a simple "yes" or "no" vote on whether to tax large oil producers for drilling in their state. Proponents of the initiative, known as "Alaska's Fair Share," believe this measure will provide the state with much needed revenue without having to enact new taxes on residents first. Opponents fear that the tax hike initiative would dissuade oil firms from drilling there and threaten future crude oil output in the region, especially at a time when the Covid-19 pandemic is already affecting oil production worldwide.

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Eleven states and the District of Columbia have fully legalized marijuana. Now, with Proposition 207, voters in the Grand Canyon State will decide whether their state will also legalize the growth, sale and use of marijuana by adults 21 years or older. If approved, Arizona would impose a 16% excise tax on pot sales that will be used to fund public programs such as community colleges, public safety, health and roads. That could generate up to $300 million per year in revenue for the state. Proposition 207 would also amend criminal penalties for marijuana possession, ban pot smoking in public, authorize state and local regulation of licenses and allow the removal of marijuana criminal offenses.

Meanwhile, Proposition 208 proposes a 3.5% tax surcharge on taxable income of more than $250,000 for single taxpayers, or $500,000 for married couples filing jointly, to increase funding for public education. Backed by teachers, parents and education proponents, Proposition 208 would require revenue from the 3.5% income tax to be placed in the Student Support and Safety Fund and would go toward school teachers and support staff salaries, technical programs, retention and mentoring programs for new teachers and scholarships to the Arizona Teacher's Academy. Currently, the highest income tax rate in Arizona is 4.5%. Proposition 208 would increase the top rate to 8%.

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For voters in Arkansas, Issue 1 would amend the state's constitution to continue a temporary 0.5% sales and use tax for highways, bridges, and other surface transportation after the retirement of bonds that were authorized by voters in 2012.

The half-cent sales tax may seem small, but the issue is a big deal because legislators are asking voters to make this so-called temporary tax a permanent fixture in the state's constitution. According to TRIP, a Washington, D.C.-based non-profit surface transportation advocacy group, the average driver in the Little Rock area loses nearly $1,700 a year as a result of driving on bad, congested and unsafe roads. To help lower that cost, Arkansas's governor signed a transportation bill last year that hiked gas and diesel taxes and set aside money from the state's casinos for highway........

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