Archive for Monday, February 13, 2012

Bill designed to raise disaster funds criticized as establishing hidden tax

February 13, 2012

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— A plan to raise funds to handle future disasters got some rough treatment Monday from critics who said it would put in place a hidden tax increase.

House Bill 2572 would establish a disaster fund under the Kansas Adjutant General’s office. It would collect $12 million on taxes collected on insurance premiums and $10 million from the Kansas Universal Service Fund, which is paid by telephone customers through a monthly charge.

Telephone company representatives said using telephone charges to deal with disasters was inappropriate since the service fund was established to support telecommunications services. In addition, they said the state’s service fund charges already are among the highest in the nation.

“Just because the KUSF surcharge is in existence does not warrant this mismatched funding proposal, no more than increasing gasoline taxes or imposing a hotel bed surcharge,” said John Idoux, with CenturyLink, which provides rural phone service.

Mike Scott, with AT&T;, said it would increase the charge on customers by up to 30 cents each month. “If HB 2572 becomes law, it could be viewed as a tax increase, and a hidden tax at that,” he said.

The House Appropriations Committee took no immediate action on the measure.

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