RICHMOND, JAN. 14 -- Virginia Gov. Gerald L. Baliles, saying his record $22.5 billion budget makes no room for tax cuts, today criticized as untimely a Republican proposal to eliminate the state sales tax on food and Lt. Gov. L. Douglas Wilder's call to repeal the tax on nonprescription drugs.
Meeting with reporters as the 1988 General Assembly closed its first full day of business, the governor said it would be too difficult to make up the revenue that would be lost if either tax repeal was adopted by the legislature.
"Those who make a case for repeal of a source of revenue would have to identify the make-up source in the budget, and I think that would be difficult," Baliles said. "Do you take it from mental health? How about education? Do you take it from the salaries of law enforcement personnel?"
Republicans, seizing on the state lottery that is scheduled to start this spring, have prepared legislation to dedicate proceeds from the game to eliminate the state's 3.5 percent tax on groceries, which generates about $150 million a year.
In his State of the Commonwealth address on Wednesday, Baliles urged lawmakers to set aside lottery revenue in a special fund for state construction projects. Responding today to the GOP proposal for a food tax repeal, Baliles said it will be years before the lottery's proceeds could "come close" to replacing that tax revenue.
State Sen. Wiley F. Mitchell Jr. (R-Alexandria), a leader in his party's fight for the repeal, said Baliles "is getting ready to spend the lottery money, and I'm saying that if you're going to spend it, spend it so you have a direct impact on the poor and disadvantaged of Virginia."
Wilder, Baliles' Democratic running mate in 1985 and a probable candidate for governor next year, has made the drug tax one of his priorities for this session. The tax generates about $30 million annually.
Asked whether he supported Wilder's proposal, Baliles said, "It wouldn't be the first time that people in public life have differences in of opinion."
A spokesman for Wilder declined to comment on Baliles' statement.