States Look to Tax Services from Head toToe

Posted by Kendall Harmon

In the scramble to find something, anything, to generate more revenue, states are considering new taxes on virtually everything: garbage pickup, dating services, bowling night, haircuts, even clowns.

“It’s hard enough doing what we do,” grumbled John Luke, a plumber in the Philadelphia suburbs. His services would, for the first time, come with an added tax if the governor has his way.

Opponents of imposing taxes on services like funerals, legal advice, helicopter rides and dry cleaning argue that this push comes as businesses are barely clinging to life and can ill afford to see customers further put off by new taxes. This is especially true, they say, in states like Michigan and Pennsylvania, where some of the most sweeping proposals are being considered this spring.

But this is also a period of economic gloom for states. Pension funds are in the red, federal stimulus help will soon vanish, and revenues from traditional sources like income and property taxes are slumping ever lower, with few elected officials willing to risk voter wrath by raising them.

“This is born out of necessity,” said Gov. Edward G. Rendell of Pennsylvania, a Democrat. His proposed budget, being debated in Harrisburg, would tax services including accounting, advertising and data processing.

Read it all from the front page of Sunday's New York Times.

Filed under: * Economics, PoliticsEconomyTaxesThe Credit Freeze Crisis of Fall 2008/The Recession of 2007--Politics in GeneralState Government

2 Comments
Posted March 30, 2010 at 5:20 am [Printer Friendly] [Print w/ comments]



1. David Keller wrote:

How about cutting services and eliminating bloated agencies?  I guess that’s just too radical for the radical left.

March 30, 9:35 am | [comment link]
2. IchabodKunkleberry wrote:

The real problem in all the states is the overly generous pension plans
provided to public employees. Someone I know is a former state’s
attorney for his county; he is now a professor at a state-run
university; he is running (unopposed) for a circuit-court judgeship
this autumn. He will be getting pensions from all three. I believe
that when he retires from being a judge, he’ll receive 3/4 of his
annual pay, about $75,000 per annum. This sort of triple-dipping
needs to be addressed.

  Also, public sector unions such as AFSCME need to be dismantled,
much as Reagan took on PATCO. As for contributions to political
campaigns, AFSCME donates almost exclusively to Democratic
causes. In essence, a tax is being levied upon us which works
lopsidedly to the advantage of the Democratic party. This is
an abuse which must be ended.

March 30, 10:49 am | [comment link]
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