In a new policy brief, we take a look at Initiative 1366, which will be on the ballot this fall. Briefly,

• I-1366 would reduce the state sales tax from 6.5 percent to 5.5 percent unless the Legislature refers a constitutional amendment to voters for approval.
• The constitutional amendment would require two-thirds legislative approval to increase taxes.
• It would also require a majority vote of the Legislature for fee increases.
• A supermajority was first required to raise taxes when I-601 was approved in 1993.
• Since then, it has been suspended by the Legislature and reaffirmed by voters many times.
• The state Supreme Court ruled it unconstitutional in 2013.
• If the sales tax is reduced by 1 percent, it would reduce state revenues by $1.590 billion in 2015–17 and by $3.066 billion in 2017–19.
• Such a loss of sales tax revenues would significantly impact the state budget.
• Some may consider the crisis atmosphere created by a sales tax reduction an opportunity to increase other taxes or levy entirely new ones.