Tuesday, June 10, 2008

In Sacramento, also?


Our friends in Sacramento never rest in exploring for new, creative and suspect ways to generate revenue. Because the state legislature needs a 2/3rds majority to raise taxes and because of the heat they would take for doing so, a favored mechanism for Democrats in Sacramento to get their hands into your pocketbook is the State Board of Equalization. (it speaks volumes that the entity charged with overseeing the taxation infrastructure in this state would have included in its title “equalization”).

The state charges a sales tax on “personal property which may be seen, weighed, measured, felt, or touched, or which is in any other manner perceptible to the senses.” This has always been understood to mean goods not services and because of this, some on the Board, at the request of the Assembly, have been working overtime to stretch, twist, and expand this definition.

The state Assembly has been trying for a while to get taxes on music downloads such as those from iTunes and other ecommerce trade. This is above and beyond the “use tax” that Californians are required to declare on their state tax forms for the purchase and sale of tangible goods. (Incidentally, the Board is pushing to deputize 325 new tax detectives to make sure you are paying this tax.)

But now the Board has been encouraged to move beyond the internet and begin taxing services as well. Assembly tax chairman, Charles Calderon , D-Montebello, has encouraged the Board to think big, you know, really get outside the box by saying it has, “as much of a responsibility (as state lawmakers) in terms of enforcing our laws and bringing in the revenue that the state needs.” Yee-hah!!!! (We're puzzled and amused that Calderon thinks the state Assembly is a law enforcement agency. Got Freud?).

So in Calderon’s world, haircuts, landscaping, car washes and the sale of tickets to sporting events will all be subject to a 5% sales tax.

Fortunately, between the Republicans and one rogue Democrat on the Board, Betty Yee, who oppose this plan, the chances for redefining of the tax code are doubtful, for now. But as with the ungodly Freddy Krueger-like persistence of Congress in attempting to sneak Amnesty provisions into the nooks and crannies of agriculture and supplemental war funding bills, you just can’t sleep on these people.

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