Thursday, October 15, 2009
Listen to Lenin!
"State and municipal governments, stuggling with sinking revenue, are raising money by levying fees on consumers, slapping businesses with back taxes and tweaking tax laws in ways that force many businesses to pay more. That is leading to accusations--and, in some case, lawsuits--that governments are trying to rake in more money without officially raising taxes, sometimes illegally. ... Last week, five retailing groups sued New York state alleging that a new tobacco-registration fee was unconstitutional. The groups argued the new fee, which uses a sliding scale based on a retailer's total sales, instead of just cigarette sales, 'is essentially a tax,' said Andrew Curto, a lawyer representing the groups. ... In San Francisco, tax lawyers say the city is sidestepping the electorate by labeling the new cigarette levy as a fee instead of a tax. ... Among the more aggressive states has been California, which teetered on the brink of insolvency during a budget impasse earlier this year", Conor Dougherty at the WSJ, 26 September 2009, link: http://online.wsj.com/article/SB125392874638642923.html.
Who said California still isn't "on the brink of insolvency"? Muni bonds anyone? See my 20 October 2008 post on the Franchise Tax Board: http://skepticaltexascpa.blogspot.com/2008/10/californias-gestapo.html. If you don't have to do business in California, get out. While the going is good.