Rendell praises legislators' tax proposal

Under the plan, sales tax would be levied on groceries and clothing.
HARRISBURG (AP) -- Gov. Ed Rendell had some good things to say Friday about a plan by a group of legislators to expand the state's sales tax to eliminate school property taxes.
Rendell said he was "looking at" a proposal by the Commonwealth Caucus that would impose the tax on groceries, clothing and all services, though he stopped far short of an endorsement.
"Right now, I don't think their numbers add up; I don't think we can totally cut or eliminate the school property tax. But can it work? I think it might," Rendell said at a Capitol news conference.
The Commonwealth Caucus, a bipartisan group of state legislators, wants to cut the state's 6 percent sales tax to 4.5 percent and expand its application to eliminate the $7.5 billion that property owners in the state pay annually in school taxes.
Possible opposition
The governor voiced concern about potential opposition within the business community and what effect such a system would have on lower-income households -- for example, a single mother with two children who earns $28,000.
"We have to measure the impact of what that would do, particularly if that mother was a renter and didn't get the concurrent benefit of a slash in the property tax," Rendell said.
Rendell, however, praised the Commonwealth Caucus for "visionary thinking" and "keeping the debate going."
"Have we gone far enough? In my judgment, no, and in the Commonwealth Caucus' judgment, absolutely no. Do we need to go farther? I think so," he said.
Rep. Mario M. Scavello, R-Monroe, said he was encouraged by a meeting with Rendell's budget and revenue officials Wednesday, and by an earlier meeting with the Democratic governor.
"I'm looking forward to the governor's input and see what he recommends," he said.
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