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KNOXVILLE, Tenn. — The man who headed the Tennessee tax reform commission 17 years ago said Monday a combination of taxes, including an income tax, is the best solution to the state’s revenue problems today as it was in 1974.

Dr. Edward J. Boling, University of Tennessee president in 1970-87, was chairman of the Tennessee Tax Modernization and Reform Commission which in 1974 recommended an income tax.

The commission’s report, submitted to then-Gov. Winfield Dunn and the General Assembly, also called for major reform of the state’s system of financing grades K-12.

The 1974 report outlined recommendations to ”provide greater balance, equity and elasticity in the tax structure, to begin greater state support for education, and to create a simpler and fairer system of revenue sharing between the state and its local governments.”

Boling said the tax commission anticipated 17 years ago that Tennessee, without meaningful tax reform, eventually would be faced with a lawsuit challenging the constitutionality of its public school financing.

Last Thursday, Chancellor C. Allen High of Nashville ruled in a lawsuit brought by 77 small, rural school districts that Tennessee’s method of financing public schools discriminates against poorer counties and is unconstitutional.

”I am not surprised at Chancellor High’s ruling. The same kind of lawsuit has been decided in Kentucky, Texas and many other states. I had no question about what the outcome would be,” Boling said.

”We’re in this situation today because of the current economic recession and its impact on the state budget,” Boling said. ”Had they (state government) listened to us (the 1973-74 commission) and looked at what we did, we could be well ahead of where we are now,” Boling said.

Boling, who was state commissioner of finance and administration in the early 1960s, said Tennessee is in a financial crunch because of its long-standing reliance on consumer taxes to finance state government, including the schools.

The income tax, as part of a combination of taxes, is the best long-range solution, Boling said.

”There are other options — not good options at all — that almost defy passage because of the pressure groups and special interest groups. But even if you could, it’s wrong to rely on a consumer tax to raise that amount of money,” Boling said.

”If you took all the exemptions off the sales tax, you’d have a lot of dollars there, but those dollars would go up and down as the economy fluctuated. What we need is a balance (between consumer and income taxes).”

Boling said most states have a combination of sales and income taxes to finance state government.

”If you’re going to be competitive, whether it’s education or anything else, you must have the revenues it takes to operate the state. And, without an income tax, you cannot continue (to increase) consumer and business taxes the way we have the last few years. It’s obvious you can’t because you can see the mess we’re in from trying to depend on that,” Boling said.

”I think you must go to a combination of taxes which enables the state to adjust to good and bad economic times…and the only way I know you can do that is move to some sort of tax other than a consumer or business tax.”