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Showing posts with label Revenues. Show all posts
Showing posts with label Revenues. Show all posts

Sunday, June 5, 2011

GOP's 2012 Doomsday Strategy: Everything Or Nothing! (Grover Norquist)

















GOP Leaders Being Advised By Grover "No Tax Increase" Norquist Is The Reason Why Pres. Obama WILL In Fact Win A 2nd Term Come November 2012!

Who Is Grover Norquist?

Norquist Is President Of Americans For Tax Reform / Republican Strategist & The Male Version Of Sarah Palin!

You See Mr. Norquist Is Very Influential & Holds The Purse Strings Of Quite A Few Powerful GOP Leaders On Capitol Hill.

And Even Though Many Of Them May Secretly Despise Him, They Are Afraid To Disobey Or Say "No" To Norquist Because Doing So May Very Well Ruin Their Political Careers.

Thus When Norquist ORDERS GOP Leaders: Senator Mitch McConnell, Speaker John Boehner & House Majority Leader Eric Cantor To Vigorously Push His "No Tax Increase" Agenda, Like Mindless Mummies They Quietly Do As They Are Told.


FYI: Here Are The Issues Norquist Wants GOP Leaders To Remain Laser-Focused On Until November 2012.

Get Rid Of Pres. Obama!

Refuse To Raise The Debt Ceiling,

Refuse To Draft A Jobs Bill,

Refuse To Cut Defense Spending,

Kill Medicare,

Eliminate Food Stamps,

Eliminate Foreclosure Prevention Programs,

Eliminate Pell Grants But Push Student Loans To Middle Class & Low Income College Students, (For-Profit Schools)

Eliminate Medicaid And...

Refuse To Raise Taxes On America's Super Wealthiest Citizens.


FYI: Behind The Scenes Norquist Has Advised GOP Leaders Not To Compromise With Pres. Obama Or Any Other Democrats On Any Of The Issues Listed Above.

Even If It Means Bringing TOTAL DESTRUCTION To The American Economic System!

i.e., EVERYTHING OR NOTHING!

Well Guess What?

Key GOP Leaders (Including Some Governors) Are Actually Obeying Norquist As We Speak!

Thank You Grover Norquist For Assisting Pres. Obama's Campaign Staff In His Re-election!

VOTE OBAMA IN 2012!!


Visit msnbc.com for breaking news, world news, and news about the economy






Among GOP, anti-tax orthodoxy runs deep



The Republican Party once had a home for the thinking of Tom Coburn, Mike Crapo and Saxby Chambliss. But that party is long gone.

The three U.S. senators banded together a few months ago in support of higher tax revenue as a means of balancing the federal budget. Even with drastic spending cuts, they concluded, Washington could not vanquish its soaring $14.3 trillion debt without additional income.

Such reasoning was common in the GOP circa 1963, when Republicans denounced tax cuts proposed by President John F. Kennedy as a road to red ink and rampant inflation. But today’s GOP adheres to a “no new taxes” orthodoxy that has proved far more powerful than the desire to balance the budget. As House Speaker John A. Boehner has said: Raising taxes is “unacceptable and a non-starter.”

This orthodoxy is now woven so deeply into the party’s identity that all but 13 of 288 GOP lawmakers in Congress have signed a formal pledge not to raise taxes. The strategist who invented the pledge, Grover G. Norquist, compares it to a brand, like Coca-Cola, built on “quality control” so that Republican voters know they will get “the same thing every time.”

Loyalty to the brand is so strong that no Republican has voted for a major federal tax increase since 1991, Norquist says. It is so widespread that more than a dozen governors and hundreds of state legislators now count themselves as adherents. And it is so well defended that its followers are constantly patrolling at both the state and federal levels for new forms of trespass.

In California, the pledge is interpreted to prohibit state lawmakers from asking voters to decide whether certain existing taxes should be extended. In Pennsylvania, the pledge is cited as a barrier to imposing an “impact” fee on the environmentally questionable business of extracting gas from underground shale.

On Capitol Hill, Norquist has admonished Coburn (Okla.), Crapo (Idaho) and Chambliss (Ga.) for suggesting a tax option for tackling the debt: reducing credits and deductions worth an estimated $1 trillion a year. Although most of the cash would be used to lower tax rates for everyone, a portion would be dedicated to restoring national solvency.

No good, says Norquist’s group, Americans for Tax Reform. Under the pledge, raising revenue in any way requires an equal tax cut elsewhere to avoid expanding the size of government. And, yes, that sometimes means protecting tax breaks that Republicans view as bad public policy, Norquist and his supporters say.

The GOP’s three-decade-old campaign against taxes has clearly had a significant impact. Neither major party would advocate a return to the 1970s, when people earning more than $200,000 a year faced a top rate of 70 percent. But the top rate is now half that and, partly because of the recent recession, tax collections have fallen to their lowest level as a share of the economy in 60 years.



Major tax cuts in 2001 and 2003 also contributed to the decline in revenue — and helped drive up budget deficits. Today, the spiraling debt ranks well ahead of too-high taxes on the list of economic concerns. And the GOP’s hard line on the issue stands, alongside Democratic resistance to cutting federal retirement benefits, as the biggest obstacle to a bipartisan agreement to tackle that problem.

“Grover’s not realistic,” said former senator Judd Gregg of New Hampshire, a self-described “Reagan robot” elected to Congress in 1980. Gregg retired last year after serving with Coburn and Crapo on the bipartisan fiscal commission that recommended stabilizing borrowing by trimming tax breaks and sharply cutting spending.

With the number of people on Medicare and Social Security set to double, Gregg said, “your government is inevitably going to grow. And you’re either going to have to finance that, or you’re going to end up running the country into the ditch.”

In recent weeks, prominent Republicans have urged a more flexible approach to taxes. Former Federal Reserve chairman Alan Greenspan joined the chorus Friday, dropping his support for the 2001 George W. Bush tax cuts. Greenspan told CNBC he’s so “scared” by the debt that he now favors a return to the higher rates of the Clinton administration.

Martin Feldstein, a Harvard economist who served as chief economic adviser in the Reagan White House, supports the commission’s approach to raising money by ending tax breaks.

“When the government gives a tax credit to homeowners who buy solar energy panels, it’s just like giving them a cash subsidy to buy those panels,” Feldstein wrote last week in the conservative Weekly Standard magazine, suggesting that the value of deductions and credits be capped at 2 percent of adjusted income.

“Although government accounting rules treat the end of a tax credit or the limit of a tax deduction as a revenue increase, the economic effect is the same as a cut in spending,” Feldstein wrote. “Anyone who favors less government spending should also favor cutting tax expenditures.”

But Norquist argues that equating tax breaks with spending “is a threat to the modern Republican Party’s worldview,” which calls for a vastly smaller government and “dramatically reducing the tax drag on the economy.”

That worldview supports eliminating tax breaks, Norquist said, but only if all the proceeds are used to push tax rates “down as far as possible.” The work of reducing the national debt must be done entirely by shrinking government, he said. Any compromise that includes taxes would hinder that goal and taint the Republican brand.

Norquist compared Coburn, the most outspoken of the Senate trio, to a “malignant” cell in the body politic. “So,” Norquist said, “we use chemo and radiation to protect all the healthy cells around it, so it doesn’t grow and metastasize.”

Rewriting doctrine

The germ of the pledge came to Norquist, he said, when he was 14 and thinking about a teacher’s comment that no one knows who his or her congressman is. If Republicans were known as the party that never raised taxes, he recalls thinking, they would be spared spending “millions of dollars explaining to you who they are and what they stand for.” They could just “stand up and say, ‘I’m the Republican.’ And you go: ‘He won’t raise my taxes and he won’t steal my guns. Got it.’ ”

At the time, Richard M. Nixon had just been elected president, and Republicans had a reputation as the party of fiscal responsibility: Dwight Eisenhower maintained wartime tax rates throughout his eight-year presidency, dramatically reducing the national debt. Congressional Republicans objected to Kennedy’s tax cut, arguing that any reduction in revenue should be pared with spending cuts to avoid ballooning deficits. Nixon supported extending a surtax to pay for the Vietnam War. And his successor, Gerald R. Ford, opposed a permanent tax cut in 1974, fearing budget deficits, according to historian Bruce Bartlett, a “lapsed Republican” who has written extensively about GOP fiscal policy.

Three factors helped rewrite the party’s economic doctrine, Bartlett said: In the late 1970s, key Republicans concluded that lower tax rates would boost the flagging economy. The new theory of supply-side economics held that such a tax cut would spur so much growth that it would actually generate more revenue. And the Proposition 13 tax revolt hit California, demonstrating the power of tax cuts as a political issue.

Ronald Reagan capitalized on growing anti-tax sentiment in his campaign for president and quickly pushed a tax package that slashed rates, a move credited with energizing the long-sluggish economy. Reagan went back to Congress in 1986 with a sweeping overhaul of the tax code that pushed the top rate down to 28 percent. At Reagan’s request, Norquist founded Americans for Tax Reform and the pledge was born.

In his race to succeed Reagan, George H.W. Bush famously embraced the pledge, saying “read my lips, no new taxes.” But as president, he raised tax rates as part of a balanced-budget deal with Democrats. Bush’s loss to Bill Clinton in 1992 “proved for all time, that even though tax increases may be justified economically, they are never justified politically if you’re a Republican,” Bartlett said.

“Since then it’s been Republican dogma that deficits don’t matter and the only thing that matters for the economy is cutting taxes,” he said. “And Grover Norquist has become the enforcer of this dogma.”

‘Impure thoughts’

The rise of the anti-tax tea party movement in 2008 further hardened the party’s stance against taxes. How is the pledge enforced? Typically, Republican candidates sign the pledge to avoid attack in the primary. Once in office, violators might find that Norquist has contacted Republican voters in their state or district to inform them that their senator or representative is having “impure thoughts,” as he put it.

Norquist has “these amazing mailing lists. Just tens of millions of people,” said Gregg, who has been a target.

At the state level, a vast network of foot soldiers stands ready to discipline local politicians who fail to walk the no-tax line. One of the most high-profile battles is being waged in Sacramento, where Gov. Jerry Brown (D) is trying to persuade GOP lawmakers to join Democrats in extending the largest tax increase in state history, which is set to expire this month.

Last month, Norquist spent several days in the state, urging Republicans to stand firm. His argument is likely to be pretty compelling: In 2009, after enacting deep spending cuts, six GOP lawmakers helped then-Gov. Arnold Schwarzenegger (R) raise sales, income and auto taxes to close a $42 billion budget gap.

All six paid a price. The Republican leaders in both the House and Senate were deposed. The other four either retired or lost bids for higher office.

Senate Republicans dumped Dave Cogdill as their leader in a midnight coup before the tax deal was even approved. “They were hearing from their constituents and Grover Norquist, saying, ‘You got to do everything you can to fight this thing,’ ” Cogdill said in an interview.

Cogdill later retired from the Senate. He now serves as county tax assessor in his hometown of Modesto. He said he wishes he had been able to keep the pledge, but he didn’t see any alternative to raising taxes, given the state’s alarming financial condition.

Although he agrees with Norquist that taxes are too high in California, he’s not sure he would sign the pledge again. Pledges, he said, make it hard to respond to changing circumstances.

Republicans “have lost the art of compromise,” Cogdill said. “If we don’t get everything we want, then we let the whole thing burn.”



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Sources: Huffington Post, MSNBC, Washington Post, Wikipedia, Youtube, Google Maps

Monday, November 29, 2010

Online Sales Tax Revenue & State Governments (Amazon vs North Carolina)









Visit msnbc.com for breaking news, world news, and news about the economy



Visit msnbc.com for breaking news, world news, and news about the economy






Amazon Wins Fight To Keep Customer Records Private



In a Victory for the Free Speech and Privacy Rights of Amazon.com customers, a federal judge ruled today that the company would not have to turn over detailed records on nearly 50 million purchases to North Carolina tax collectors.

The state had demanded sensitive information including names and addresses of North Carolina customers--and information about exactly what they had purchased between 2003 and 2010.

U.S. District Judge Marsha Pechman in Washington state said that request went too far and "runs afoul of the First Amendment." She granted Amazon summary judgment.

The Tar Heel State's tax collectors have "no legitimate need" for details about the literary, musical, and cinematic habits of so many Amazon customers, Pechman wrote. "In spite of this, [North Carolina] refuses to give up the detailed information about Amazon's customers' purchases, while at the same time requesting the identities of the customers and, arguably, detailed records of their purchases, including the expressive content."

Amazon has provided the state tax collectors with anonymized information about which items were shipped to which ZIP codes. But North Carolina threatened to sue if the retailer did not agree to divulge the names and addresses linked to each order--in other words, by providing personally identifiable information that could be used to collect additional use taxes that might be owed by state residents.

Pechman's opinion did leave open the possibility of North Carolina tax collectors deleting the data they currently have and firing off a narrower request to the online retailer: "Issuing the declaratory relief as phrased does not prohibit [N.C. tax collectors] from issuing a new request for information as to only the names and addresses of Amazon's customers and general product information, assuming that [the state] destroys any detailed information that it currently possesses."

Because Amazon has no offices or warehouses in North Carolina, it's not required to collect the customary 5.75 percent sales tax on shipments, although tax collectors have reminded residents that what's known as a use tax applies on anything "purchased or received" through the mail. The dispute arose out of what had otherwise been a routine sales and use tax audit of Amazon by North Carolina's tax agency.

As CNET previously reported, Amazon filed a lawsuit in April after negotiations with the state tax collectors broke down. Neither side could be reached for comment this evening.

In addition, the ACLU intervened in the lawsuit asking for an even broader injunction against the tax collectors. They wanted Amazon to be prohibited from disclosing customer purchases without a subpoena, which the court did not grant.

In general, as Amazon stressed in its lawsuit, purchases of books, DVDs, Blu-ray discs, and other media enjoy special privacy protections.

In a 2002 decision, the Colorado Supreme Court ruled that the First Amendment protects "an individual's fundamental right to purchase books anonymously, free from governmental interference." The justices tossed out a subpoena from police to the Tattered Cover Bookstore asking for information about what books a certain customer had purchased.

And in a 2007 case, federal prosecutors tried unsuccessfully to force Amazon to identify thousands of customers who bought books online, but abandoned the idea after a judge rebuked them. Judge Stephen Crocker in Wisconsin ruled that "the subpoena is troubling because it permits the government to peek into the reading habits of specific individuals without their prior knowledge or permission."

In addition, a federal law called the Video Privacy Protection Act makes it illegal for anyone selling movies to disclose customer information to anyone, including state tax collectors. The 1988 law specifically covers "prerecorded video cassette tapes," and also sweeps in "similar audio visual material" such as DVDs and Blu-ray discs.

North Carolina's legal setback comes as other states experiment with new ways to collect taxes from online retailers. California may require retailers to report the total dollar value of purchases made by each state resident. A decision is expected at any time in a related case that Amazon filed against New York state.

Update October 26 at 7:06 a.m. PT:

Last night I asked the North Carolina Department of Revenue what its plans were, including: "Will you destroy that information and issue a new request?" I just received a partial response via e-mail, which doesn't answer that particular question. All it says is: "Attorneys with our office are currently reviewing the ruling, and no decision has been made yet about whether or not the State will seek an appeal."

Update October 26 at 10:40 a.m. PT:

The ACLU sent over this response from staff attorney Aden Fine (it's also put the opinion online): "Disclosing the purchase records of Internet users to the government would violate their constitutional rights to read and purchase the lawful materials of their choice, free from government intrusion, and undermine the very basis of American democracy and our cherished freedoms. With this ruling, the court emphatically reemphasized what other courts have found before - that government entities cannot watch over our shoulders to see what we are buying and reading."



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Sources: Amazon.com, CNBC, CNET, MSNBC, Google Maps

Thursday, October 21, 2010

Prop 19 No Financial Cure All For California; Still Illegal









Legal Pot Means Big Savings On California's Law Enforcement But Not Cure All


Cash-strapped California would get some relief by legalizing pot, but the biggest boost would be thanks to massive law enforcement cuts, not new tax revenue, experts say.

The state's marijuana legalization initiative known as Proposition 19 goes to the polls on Nov. 2. And there's been a lot of talk about taxing it to rescue the state from its budget woes. But even legalization's top advocates say the drug won't be a financial cure-all.

"No one's promising that this is going to solve everything economically," said Quintin Mecke, spokesman for Assembly Member Tom Ammiano, D-San Francisco, who was the lead sponsor on two earlier efforts to legalize marijuana.

Most of the financial benefit would actually come from budget cuts - which means job cuts -- according to a report from the Cato Institute, a libertarian think tank in Washington, D.C. The institute estimates that legalization could add $1.312 billion annually to California's coffers. But the forecast's breakdown calls for a savings of $960 million in law enforcement costs and an additional $352 million in tax revenue.

Jeffrey Miron, a senior lecturer at Harvard University and senior fellow at the Cato Institute who co-authored the study, said the majority of the cost savings would be a result of cuts to law enforcement personnel whose services would no longer be required. And axing police officers, prison guards, prosecutors and judges would hurt the job market, at least initially, he said.

That leaves an estimated $352 million in annual tax revenue, a tally that Miron described as "not irrelevant, but not very consequential." He said it's a welcome bonus for Californians who prefer legalization regardless, but it's not enough to sway those who oppose it.

"I think that California is being somewhat optimistic in thinking that this is going to make a significant difference to its budget situation," said Miron, who supports legalization. "I think it won't do much for the economy."



Ammiano's previous legalization bills, which died in assembly, included a statewide tax of $50 per ounce that would be imposed on producers. Based on that, the State Board of Equalization estimated that California could raise $990 million - in addition to $392 million in sales taxes.

But that estimate isn't relevant to Prop19, according to Anita Gore, spokeswoman for the board.

Unlike Ammiano's bills, Prop19 wouldn't make marijuana legal on a statewide basis. Instead, it would have a patchwork effect, giving local governments the power to allow or prohibit pot sales, and to impose taxes or fees on marijuana sales in addition to a sales tax.

"Any sale would be taxable, so there would be sales taxes collected," said Gore. "But beyond that, we don't know how many localities would approve the sale and how many other fees would be added."

Adding to the complexity, local governments in California that legalize marijuana sales would impose their own tax rate, which varies from one area to the next. In addition, some local governments might impose an excise tax on retailers and producers, while others might not.

"There are too many unknowns to be able to come up with a revenue estimate," said Gore.

Dale Gieringer, director of the California chapter of the National Organization for the Reform of Marijuana Laws, otherwise known as NORML, has a more optimistic take on potential tax revenue, but even he says it will be a very long time before the state sees any of those funds.

Gieringer said that taxes from medical marijuana total about $100 million annually, and that based on that, Prop 19 could bring in about $500 million in annual sales taxes for the state.

But that's going to take years to kick in, even if Prop 19 passes in November, he said. Local governments considering legalization will take some time to consider the benefits of additional tax revenue versus the threat of federal lawsuits, since the drug would still be illegal under federal law.

Gieringer added that medical marijuana was legalized in California in 1996, but said it took another eight or nine years to spread across the state.

"I'm assuming that we're looking at a similar long term phase-in of Prop 19," he said. "It's going to be many years, if 19 passes, before it's going to take effect on the whole state."



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Sources: CNN, Fox News, High Times, Youtube, Google Maps

Thursday, September 30, 2010

Bev Perdue Throws Ken Lay Under The Bus Over Millions In Tax Revenue!








NC Tax Secretary Chief Is Out, N.C. State Senator Is His Replacement


North Carolina Revenue Secretary Kenneth Lay is leaving his job after a series of problems involving refunds that have frustrated North Carolina taxpayers seeking any little bit extra in their wallets in the extended downturn.

Gov. Beverly Perdue's office announced she had accepted Kenneth Lay's resignation Wednesday and will replace him with outgoing state Sen. David Hoyle, D-Gaston, until recently the longtime co-chairman of the Senate Finance Committee.

The resignation's effective date is Oct. 22 for Lay, a former Bank of America executive who took the Cabinet position when Perdue was sworn in January 2009.

"I thank Ken Lay for his service to the state, and for the progress he has made in seeking a new strategic direction for the Department of Revenue," Perdue said in a statement.

When asked if Lay was forced out, Perdue spokeswoman Chrissy Pearson said only the governor and Lay agreed Wednesday that it was the right time to bring in new leadership. Asked for an explanation of his departure beyond a two-sentence resignation letter, Lay said in a prepared statement only that the strategic vision "has reached a point of inflection, which is a perfect time for new leadership."

Lay had been under fire in recent weeks after a new department policy made public was making it harder for North Carolina residents to get refunds when they overpaid their taxes by mistake, potentially leading to millions of dollars in withheld funds. Last year's change, following a 2007 law, led department officials to direct workers not to review returns flagged for a refund if they were more than three years old.

Perdue said last month she hadn't known earlier about the department policy change. Lay and the governor announced soon after a plan to eliminate a backlog of 230,000 returns since 1994 in the agency's computer system by year's end and pay refunds.

But Lay told The News & Observer of Raleigh recently the General Assembly would have to alter the law so that refunds for returns older than three years could be paid.

Hoyle, who decided not to run for a tenth term in November, said the price tag on the ill will with taxpayers with the policy change costs more than the refunds that had been otherwise withheld.

"We have an obligation to the citizens to administer everything fairly," Hoyle said in an interview. "People are suspicious of government anyway ... it's just not right."

The tax collections department also had been forced to delay tax refunds the past two years because of cash flow problems within state government. More than 300,000 refunds valued at $222 million hadn't been distributed this year, nearly a month and a half after the April 15 filing deadline.

Lay also took criticism after a WRAL-TV report found two department leaders had been reimbursed tens of thousands of dollars for mileage and lodging while commuting between their Charlotte area homes and their Raleigh offices.

Hoyle, 71, said he accepted Perdue's job offer Tuesday. He said he wanted to help Perdue, a former senator and president of the Senate as lieutenant governor.

Hoyle "has seen the Department of Revenue from the inside and out. He has spent years helping to write the state's tax laws, and I'm sure that experience will prove invaluable in his new role," Perdue said in her statement.

Hoyle was often a foil of the department as the Finance Committee leader, criticizing the agency for putting small business owners over a fiscal barrel because of poor advice it gave taxpayers or vague rules.

"I think a lot of people get caught in a trap," he said.

Hoyle said he would resign his Senate seat the day before he assumes his new job. Perdue said Hoyle's appointment was subject to a usual review by the state Ethics Commission. Hoyle said he doesn't believe his extensive business dealings will generate potential conflicts of interest.






Bev Perdue Right To Replace North Carolina State Revenue Secretary

Gov. Bev Perdue was right to replace N.C. Secretary of Revenue Kenneth Lay, a former Charlotte banker, after his department changed state policy and kept taxpayers' overpayments if they did not request a refund with a three-year statute of limitations.

That policy was unethical, undermined public trust in state government and, not to put too fine a point on it, was dumb.

Perdue's office said the governor never knew about it until a newspaper report in mid-August revealed the department was not informing taxpayers about the overpayments, making it harder to get refunds if taxpayers had not asked for them.

The Revenue Department has released e-mails that suggested it had consulted staffers in the governor's office about the change. In stories that ran Sunday in the News & Observer of Raleigh and the Charlotte Observer, Lay said he could not explain why the governor didn't know about the policy change and said he thought her office had checked off on it. Her staff said the matter was mentioned only in the briefest way, not in a formal policy discussion.

The department should have recognized the political storm that would blow up over keeping money that shouldn't have been paid to the government, and Perdue was rightly incensed when she learned of it. She ordered the department to eliminate a backlog of flagged returns by the end of this year and send the overpayments back to taxpayers. Officials have since determined the state owes $949,000 in overpayments to 3,300 taxpayers, but refunding them all will require a change in state law when the legislature convenes next year.

We don't know what Perdue thought when she saw Lay's remarks Sunday saying the governor's office had acquiesced in the change, but we imagine the words "new leadership" were among them. She announced Wednesday that she had accepted Lay's resignation and that outgoing state Sen. David Hoyle, D-Gaston, would replace him.

That Perdue would turn to a longtime ally is not surprising. Hoyle is an experienced politician and businessman unlikely to make a blunder such as hanging on to tax overpayments. And as co-chair of the Senate Finance Committee, he knows state tax policy. Whether he's the right person to run a large bureaucracy is another question, but Perdue's office surely will be careful to make sure he has a good staff - and that the governor's office knows what it's doing this time.



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Sources: McClatchy Newspapers, WRAL, Google Maps

Monday, December 14, 2009

NC Tax Code Double Taxes Poor & Middle Class
















































Study: NC Tax Policy hurts Poor


North Carolinians in lower income tax brackets pay a higher percentage of their income in state and local taxes than the wealthiest taxpayers in the state, according to a study by the Institute for Taxation and Economic Policy.

The 50-state report compiled the amount each income group paid in income, sales, excise and property taxes over a multiyear period. The date shows that most states do, in fact, have regressive tax structures, explained Kelly Davis, the Midwest regional director for ITEP.

“Fairness is, of course, in the eye of the beholder,” reads the study. “Yet almost anyone would agree that the best-off families should pay at a tax rate at least equal to what low- and middle-income families pay. Virtually every state fails this basic test of tax fairness.”

Income taxes are progressive, meaning those who earn more pay a higher percentage. Other state and local taxes, such as sales and property taxes, are regressive. Although they tax everyone equally, those who earn less are paying more proportionally.

“We know that low-income people spent most of what they earned on things that are subject to regressive sales taxes,” Davis said.

The report found that North Carolina families earning less than $17,000 each year give 9.5 percent of their income back to state and local governments. Those earning between $29,000 and $48,000 paid the most, paying 9.6 percent of their annual wages in state and local taxes. Those earning $1,150,400 or more annually, the wealthiest bracket, pay 8.1 percent.

According to the U.S. Census Bureau, the median annual household income in Buncombe County was $43,805 in 2008, roughly 16 percent below the national average.

ITEP's mission is to “keep policymakers and the public informed of the effects of current and proposed tax polices on tax fairness, government budgets and sound economic policy.” But Davis said it is up to voters and legislators to decide what to do with the information.

“Our role is to give data and make people aware of this information,” Davis said. “Making sure people are aware of tax policy is a good first step.”




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Sources: Asheville Citizen Times, John Locke Foundation, Carolina Journal TV, Granitegrok, Google Maps

Saturday, July 18, 2009

Study Reveals State Tax Revenues Rapidly Declining...At Record Lows

















NY Times----

The anemic economy decimated state tax collections during the first three months of the year, according to a report released Friday by the Rockefeller Institute of Government. The drop in revenues was the steepest in the 46 years that quarterly data has been available.

The blow to state coffers, which the report said appeared to worsen in the second quarter of the year, reflects the gravity of the recession and suggests the extent to which many states will probably have to resort to more spending cuts or tax increases to balance their budgets.

Over all, the report found that state tax collections dropped 11.7 percent in the first three months of 2009, compared with the same period last year. After adjusting for inflation, new changes in tax rates and other anomalies, the report found that tax revenues had declined in 47 of the 50 states in the quarter.

All the major sources of state tax revenue — sales taxes, personal income taxes and corporate income taxes — took serious blows, the report found.

As more people lost their jobs, took pay cuts or worked fewer hours, personal income tax collections fell 17.5 percent in the quarter. Weak retail sales sent sales tax collections down 8.3 percent. Corporate income tax collections, which are often highly variable, declined 18.8 percent.

States in the Far West had the largest declines in tax revenue, the report found. Arizona reported the largest drop in personal income tax collections, at 56.1 percent. Alaska experienced the largest overall drop in tax collections, 72 percent in the first quarter, and that was attributed to the state’s unusually high revenue collections in recent years because of high oil prices.

Local governments have fared better during the downturn. The report found that local tax collections rose 3.9 percent in the first quarter, largely because of increased property tax collections, which tend to be relatively stable and which are often based on assessments of value that do not keep pace with true market conditions.

As bad as the first quarter was, the second quarter is shaping up to be even worse, the report said. Preliminary data for the first two months of the quarter, April and May, collected from 45 states, indicated that tax revenues declined by 20 percent compared with the same period last year.

That will force states — many of which are already raising taxes or fees, resorting to layoffs or furloughing employees — to come up with more ways to raise or save money.

“The continuing sharp decline in revenues will likely force more unwanted choices for states in the months ahead,” wrote the report’s authors, Donald J. Boyd and Lucy Dadayan.




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Sources: NY Times, Rockefeller Institute of Government, Charlotte Observer, Flickr, Google Maps