Plunder, in the Name of Revenue

"Change is never easy, but it is the only way we can put New York back on the road toward fiscal and economic recovery."
-- Gov. David Paterson

Four months ago, I donned my best suit and snazziest heels to attend "Eyes on the Future," a local economic summit held in a college gymnasium that smelled vaguely of feet.

It was here that hundreds of Rochester, NY business execs and entrepreneurs gathered to whine into their Tim Horton's about the dreadful state of the Upstate economy. No jobs. Vanishing credit. Young college grads fleeing the state in record numbers. It was a real sobfest. The panelists on stage prattled on and on about non-issues like "attracting Millennial workers" and "how to better brand Rochester," all the while studiously avoiding the real elephant in the room: [i]The economy sucks because we made it so. The only way to make it better is to tighten our belts.[/i] To be fair, this is not a message that we New Yorkers are used to hearing.

Which is why I was so impressed with Governor David Paterson, who dropped by that day to give a surprise, impromptu speech. The same Governor Paterson who just declared war on the geeks.

In his brisk, toneless presentation, in which he barely paused for breath or punctuation, Gov. Paterson doled out some pretty rough justice, calling for immediate, drastic and specific cuts to government spending. He talked of change and tough times, and the need to face problems head-on, decisively. He even dropped the R-bomb — "recession" —months before most government employees could curl their lower lips to make the “R.” (One businesswoman on stage physically cringed when he said it.) It was just like watching John Wayne. If John Wayne were a lawyer from Brooklyn.

I was startled. Somehow — it could only have been by mistake — we New Yorkers had acquired a frank, no-nonsense politician in our highest office. Someone who might actually understand what it takes to revitalize a dying economy.

It’s important to understand just how Mr.-Wayne-Goes-To-Albany Paterson seems. Because otherwise, it won’t make any sense that I’m so pissed about his new budget proposal.

On Tuesday, the governor unveiled his ideas on how to close the state's $15.4 billion budget gap. It's been called a "doomsday proposal," one that Paterson himself said contains "extreme measures."

By "extreme measures," I assume he means "anti-intellectual, nickel-and-dime sabotage."

Gov. Paterson's budget is a love letter to King George III. He suggests raising taxes on wine, beer and cigars; removing caps on the already punishing gas tax; and adding new taxes on everything from movie tickets to baseball games to massages. He even boldly proposed a 21st century version of the Sugar Tax: an 18% tax on sodas and sugary juices, which he claims will cut down on childhood obesity.

Putting aside my moral indignation of having the State help me decide what to eat, what bothers me most are Paterson's new proposals on online transactions. For starters, Paterson wants to impose sales tax on all digitally downloaded products, including "prewritten software, digital audio, audio-visual and text files, digital photographs, games and other electronically-delivered entertainment services."

In other words, almost all the media I consume.

In addition, he wants to require out-of-state companies who do business in New York to form a "nexus" here, through which they'll collect state sales tax. This, he claims, will prevent a company from "avoiding charging sales and use tax on Internet purchases by creating independent but affiliated out-of-state entities to make those sales."

Meaning, I can only buy from State-approved Gamestops.

Setting aside the question of enforcement — I'd make a scary lawyer, and an even scarier cop — the new provisions raise several red flags.

Charging sales tax on downloadable content may seem like a great idea on paper, but I worry the move may encourage even more piracy over time. A 4% tax on your iTunes purchase may not seem like much, but we've become so psychologically attached to the $.99 price point that exceeding that by any amount — even just by four cents — will seem an outrage, or worse, a personal dig at a generation that chooses to purchase its media digitally, rather than physically. Nevermind that physical brick-and-mortars have been charging sales tax for decades. The very novelty of the tax will encourage piracy, at least in the short term, perhaps as a sort of protest. (I know I'd feel much less guilty bilking the government instead of a game developer.)

Normally, I wouldn't worry about the handful of people so cheap that they can't abide paying an extra four cents for a song, or an extra $2.40 on a next-gen game. But remember the main justification behind those vicious copy protection schemes wrecking up our hardware? [i]"We must do something about piracy.” [/i]What if there's a sudden, measurable influx of new pirates on the scene? Oh the fertile grounds of next-gen rootkits!

I'm also worried about that second proposal mandating "nexuses." Essentially, that means forcing companies — even independent, one-person operations — to create a new business entity, just to do business in New York.

Obviously the Wal-Marts and Microsofts and probably even Valve will comply and continue to offer goods to New Yorkers. But what about the smaller guys? Will the increased red tape (and presumably additional expense) diminish the incentive to do business in New York altogether? Does this mean that consumers will conceivably be unable to purchase games from Stardock, or some small indie developer living off paypal donations, simply because those vendors don't want more hassle?

Let me be clear: If Paterson takes away my Stardock, I'll be heading up the million-Kat march on Albany myself. Me and my 999,999 Facebook friends.

The crippling irony here is that one of the major complaints Gov. Paterson addressed in his speech — the flight of young college grads, and thus the loss of an entire generation of economic growth — is the very thing this budget proposal will accelerate.

Our brain-drain isn’t really news. New York has struggled with keeping the smart kids here for a long time. Students flock to the state to get educated, but few ever stay. It's a particularly bad problem here in Rochester, where the slowly sinking Kodak and Xerox offer even less incentive than ever for young people to stick around.

So what does Paterson suggest? Tax the very goods that appeal most to the younger, tech-savvy little engines of commerce he’s trying to court. Higher alcohol and cigarette taxes. An obesity tax for soda. New taxes on sporting events and movie tickets. And, of course, taxes on online content. He’s a one man wrecking-crew headed straight for Saturday night.

It's not that young people will leave New York simply because there's a 4% tax on their World of Warcraft subscriptions. Rather, it's the cumulative effect. They'll have to pay so much more for every little aspect of their daily lives — why should young people stick around when it seems the governor is singling their generation out for special treatment? (I noticed there were no proposed taxes on hearing aids or Metamucil.)

Look, I'm not naïve. I know that, realistically, our tax structure must be updated for the 21st century. As commerce spreads from the brick-and-mortar store to the virtual marketplace, so too should the ways society funds its communities evolve.

But is this really the best idea we can come up with?

This isn't the John Wayne I saw four months ago, swaggering across a stage and rustling whiny businessmen into line with tough talk about budget cuts. Looking back, I'm not sure who that guy was.

I mean, sure: The economy is tough. But it's even tougher when you're stupid.

Comments

Poppinfresh wrote:
OG_slinger wrote:
doubtingthomas396 wrote:

It continues to baffle me how politicians, in the face of pretty much all of recorded history, can think it's possible to tax a constituency into prosperity. It's not quite as severe as killing the golden goose to get the eggs, it's more like hiring a team of toddlers to chase after the goose squealing while a slow, fat dude wearing swim fins tries to catch it.

The issue isn't prosperity. The issue is that a budget shortfall exists because the services constituents expect or want exceeds the tax revenue coming in. Your two choices are cut services or increase revenues. He's simply going with the increase revenues option.

Ding!

You can also increase debt to get over a hump. Boy is that popular. But then it never seems to get paid down. Then you start to look like California. I wouldn't endorse having the financial statements of California.

Tell me about it. Our 2009 budget is built around the equivalent of IOUs, credit cards, Green Stamps, and Eron Accounting (tm). And that doesn't even include the service cuts.

Not sure I like dragging P & C onto the front page, but awesome writeup nonetheless.

I'm sorry, I stopped reading after you complained about a potential 4 cent raise to your iTunes songs.

I'm from Canada, Québec actually. Here we pay a 12.8% tax on everything but unprepared food and books (on which we pay a 7.5% tax). We have absurdly high alcohol and gas taxes (our gallon is still over 3$)

Do you know what we do with taxes?

roads, schools, healthcare, army, etc. Our collective tax dollars ensure that if we have hard times, we'll never be totally desperate.

In a time of crisis, I'm glad to be Canadian, part of a country that socially is forward thinking. I'm glad that my people don't mind paying 12.8% of their spendings to make sure that their neighbor is alright. I'm glad we care.

interstate78 wrote:

I'm sorry, I stopped reading after you complained about a potential 4 cent raise to your iTunes songs.

I'm from Canada, Québec actually. Here we pay a 12.8% tax on everything but unprepared food and books (on which we pay a 7.5% tax). We have absurdly high alcohol and gas taxes (our gallon is still over 3$)

Do you know what we do with taxes?

roads, schools, healthcare, army, etc. Our collective tax dollars ensure that if we have hard times, we'll never be totally desperate.

In a time of crisis, I'm glad to be Canadian, part of a country that socially is forward thinking. I'm glad that my people don't mind paying 12.8% of their spendings to make sure that their neighbor is alright. I'm glad we care.

Perhaps you should have finished the article before so quick to judge the piece. Focusing on the 1 line you stopped reading at you missed the point.

A 4% tax on your iTunes purchase may not seem like much, but we've become so psychologically attached to the $.99 price point that exceeding that by any amount — even just by four cents — will seem an outrage, or worse, a personal dig at a generation that chooses to purchase its media digitally, rather than physically.

You come across as though you're protesting against an attack on your entitlement for $0.99 price point and your convenience of digital downloads.

KaterinLHC wrote:

It's not that young people will leave New York simply because there's a 4% tax on their World of Warcraft subscriptions.

I think you're overestimating the impact on WoW of the above, compared with:

KaterinLHC wrote:

an 18% tax on sodas and sugary juices

That's at least an 18% drop in raid efficiency!

interstate78 wrote:

I'm sorry, I stopped reading after you complained about a potential 4 cent raise to your iTunes songs.

I'm from Canada, Québec actually. Here we pay a 12.8% tax on everything but unprepared food and books (on which we pay a 7.5% tax). We have absurdly high alcohol and gas taxes (our gallon is still over 3$)

Do you know what we do with taxes?

roads, schools, healthcare, army, etc. Our collective tax dollars ensure that if we have hard times, we'll never be totally desperate.

In a time of crisis, I'm glad to be Canadian, part of a country that socially is forward thinking. I'm glad that my people don't mind paying 12.8% of their spendings to make sure that their neighbor is alright. I'm glad we care.

You care sooooo much! I wish we call could be as insightful and progressive as you are. ^-^ Oh, I was talking with my eyes closed again.

OG_slinger wrote:
Poppinfresh wrote:
OG_slinger wrote:
doubtingthomas396 wrote:

It continues to baffle me how politicians, in the face of pretty much all of recorded history, can think it's possible to tax a constituency into prosperity. It's not quite as severe as killing the golden goose to get the eggs, it's more like hiring a team of toddlers to chase after the goose squealing while a slow, fat dude wearing swim fins tries to catch it.

The issue isn't prosperity. The issue is that a budget shortfall exists because the services constituents expect or want exceeds the tax revenue coming in. Your two choices are cut services or increase revenues. He's simply going with the increase revenues option.

Ding!

You can also increase debt to get over a hump. Boy is that popular. But then it never seems to get paid down. Then you start to look like California. I wouldn't endorse having the financial statements of California.

Tell me about it. Our 2009 budget is built around the equivalent of IOUs, credit cards, Green Stamps, and Eron Accounting (tm). And that doesn't even include the service cuts.

If business did what the government does to their books, they'd all end up in jail. In fact, some have ended up in jail.

I remember the movie Dave, when Dave has his friend who's an accountant come to the White House and the guy says "I couldn't get away running my business like this".

Ulairi wrote:

You care sooooo much! I wish we call could be as insightful and progressive as you are. ^-^ Oh, I was talking with my eyes closed again.

I was certain I'd get a response like that to what I wrote. I didn't mean to come out as pretentious because I pay more taxes. Tell you the truth, it gets on my nerves a lot sometimes that we're the most taxed state/province in North America but that's a choice we made as a society and since we're doing alright, why would I complain eh?

No, what I meant to say is, when your state is in debt, cutting down on sugars won't do. TAXES pay the bills. Nobody likes it when someone tells 'em ''hey, we're gonna take your money but you won't really get anything for it'' but at some point, who's gonna solve the situation if no one is willing to pay?

The first thing she mentions is how ''The economy sucks because we made it so. The only way to make it better is to tighten our belts.'' but as soon as some resolutions impact her wallet, she's outraged. I guess that's only human

The first thing she mentions is how ''The economy sucks because we made it so. The only way to make it better is to tighten our belts.'' but as soon as some resolutions impact her wallet, she's outraged. I guess that's only human

At what point do the productive people leave? If I'm going to be taxed to death, on everything I do, everytime I turn around, I won't live in NYC.

interstate78 wrote:

The first thing she mentions is how ''The economy sucks because we made it so. The only way to make it better is to tighten our belts.'' but as soon as some resolutions impact her wallet, she's outraged. I guess that's only human ;)

I guess I should clarify: What I meant by "tighten our belts" was "cut government programs", not "tax an already over-taxed population". I'm outraged that my government's response to hard times is not to reduce its spending but to increase my taxes. That's not fiscal responsibility. If I ran my own household budget like that - freely blowing through my money, and whenever I ran out, begging for more instead of reining in my expenses - I'd be out on the street.

KaterinLHC wrote:
interstate78 wrote:

The first thing she mentions is how ''The economy sucks because we made it so. The only way to make it better is to tighten our belts.'' but as soon as some resolutions impact her wallet, she's outraged. I guess that's only human ;)

I guess I should clarify: What I meant by "tighten our belts" was "cut government programs", not "tax an already over-taxed population". I'm outraged that my government's response to hard times is not to reduce its spending but to increase my taxes. That's not fiscal responsibility. If I ran my own household budget like that - freely blowing through my money, and whenever I ran out, begging for more instead of reining in my expenses - I'd be out on the street.

I don't think this will work. These taxes hit people when they go to the store and how they live their lives. Unlike other fees that are hidden, these are out in the open.

KaterinLHC wrote:
interstate78 wrote:

The first thing she mentions is how ''The economy sucks because we made it so. The only way to make it better is to tighten our belts.'' but as soon as some resolutions impact her wallet, she's outraged. I guess that's only human ;)

I guess I should clarify: What I meant by "tighten our belts" was "cut government programs", not "tax an already over-taxed population". I'm outraged that my government's response to hard times is not to reduce its spending but to increase my taxes. That's not fiscal responsibility. If I ran my own household budget like that - freely blowing through my money, and whenever I ran out, begging for more instead of reining in my expenses - I'd be out on the street.

But what to cut? In fact the budget does call for some real cuts, that have also angered a different constituency in upstate NY. You describe the proposed taxes as anti-intellectual, while those opposed to cuts label them anti-blue collar.

As usual, great writing Kat, but I have to agree with mateo, I'm not entirely comfortable with P&C op-ed pieces on the front page.

Higher taxes on gas are good. They've got them in Europe. It encourages more fuel efficiency. Higher taxes on fast food style fattening crap like corn syrup soda bombs is also good. It encourages better diet choices.

I agree with you though that the increased internet taxes are obnoxious. Glad to be from Nevada where taxes are low. Of course, we don't have the lovely public libraries and mass transit systems you yankees have got.

Ulairi wrote:

At what point do the productive people leave? If I'm going to be taxed to death, on everything I do, everytime I turn around, I won't live in NYC.

I don't see how leaving New York is a solution to New York's problems. See, something or someone's gotta give. Somehow most people on here seem to think the government is some entity somewhere cut from the very people it's working for.

The harsh reality is that people want everything but don't want to pay for anything. In my leftist province, it's even worse. Everybody wants free health care and education (which we have), free kindergarden, free everything but whine about being taxed. Those things aren't free. The deficit of New York wasn't (only) made with bottles of whine, it must've somewhere paid for the streets and infrastructures that populate your city.

I think in fact, it's even better to tax stuff that will impact younger people because they will grow up with those taxes. It's a bit sneaky mind you, but I think it's better than taxing people who feel have an ''acquired right'' or something. How do I cope with being taxed that much? well, it's always been that way. I'm used to it

KaterinLHC wrote:

I guess I should clarify: What I meant by "tighten our belts" was "cut government programs", not "tax an already over-taxed population". I'm outraged that my government's response to hard times is not to reduce its spending but to increase my taxes. That's not fiscal responsibility. If I ran my own household budget like that - freely blowing through my money, and whenever I ran out, begging for more instead of reining in my expenses - I'd be out on the street.

It's always an assumption that the government throws money out the window but do you have examples?

As usual, great writing Kat, but I have to agree with mateo, I'm not entirely comfortable with P&C op-ed pieces on the front page.

I find this stance a bit odd. Especially when the subject is directly related to a mode of commerce that is gaining a lot of ground in the gaming industry.

interstate78 wrote:

I don't see how leaving New York is a solution to New York's problems.

But that's the point of the article. It's not a solution to New York's problems. But individuals will typically care more about themselves and their families than an entire state. So NY needs to realize that driving away people it needs is not healthy to its economy.

Lara's point is not "taxes BAD!" but that taxes can be (and have been) used selectively and thoughtfully to drive economies. In this case, not so thoughtfully.

KaterinLHC wrote:

I'm outraged that my government's response to hard times is not to reduce its spending but to increase my taxes. That's not fiscal responsibility. If I ran my own household budget like that - freely blowing through my money, and whenever I ran out, begging for more instead of reining in my expenses - I'd be out on the street.

The more you or I hose up our finances, the more expensive it becomes for us to borrow - our credit scores and limits go down, and interest rates go up. For the US Government though, the more missteps it makes with the economy, the more cheaply it can sell Ten-year Treasury note bonds for cash, because investors are scared of losing their money and want the "safest" place to put it. And the Feds may not make a loan to you or me, but they may make one to New York State, so good or not, Government finances in this country will always function differently from personal finances...

As for my two cents, I'd gladly pay a 4% tax for Settlers of Catan on XBLA, but only if I felt sure it'd help keep me from playing the board-game version with you all in Hooverville.

I don't know enough about NY's budget to know if it's spent wisely or not, but if this proposal were coming from Oregon's Government, I'd want to know what it'd actually be paying for... If they can't afford fuel for fire engines now because property values and property taxes are down, or if they can't fund school budgets because people are spending less and there are less sales tax revenues overall, I'd vote for finding an additional source of income.

Great article though, and I do think it's worth putting on the main page -- new legislation that could impact gaming seems worth highlighting and talking about, at least to me.

Quintin_Stone wrote:
interstate78 wrote:

I don't see how leaving New York is a solution to New York's problems.

But that's the point of the article. It's not a solution to New York's problems. But individuals will typically care more about themselves and their families than an entire state. So NY needs to realize that driving away people it needs is not healthy to its economy.

Lara's point is not "taxes BAD!" but that taxes can be (and have been) used selectively and thoughtfully to drive economies. In this case, not so thoughtfully.

ya know, I don't think you can justify that. I can't believe enough people would leave for the measures not to benefit the state as a whole.

If everytime an effort must be made from the population, we justify not taking any action by saying people will not participate or worse, will flee, then we're not trying to find a solution. What I hear of all this is a bit Godot-ish:

''Time to tighten our belt!''
''oh but people won't like that''
''then let's do nothing''
''good idea''

of course i'm a bit exaggerating but you can't find a solution that will make everybody happy. That's impossible. You cut on government programs, then you create more unemployment, which isn't helping the recession one bit. you raise taxes, then you risk to disgruntle your population. One thing you can't do, is do nothing.

There will always be an apparently valid reason not to take action.

ah well.

Certis wrote:
As usual, great writing Kat, but I have to agree with mateo, I'm not entirely comfortable with P&C op-ed pieces on the front page.

I find this stance a bit odd. Especially when the subject is directly related to a mode of commerce that is gaining a lot of ground in the gaming industry.

Or that it's okay to discuss certain political topics (e.g., Obama's stance on videogames) but not others.

As digital culture spreads, it will inevitably impact the flow of public discourse. We can't ignore it. In fact, I think we should welcome the discussions it spawns. What is the role media plays in our daily lives? Not just in our families or personal lives, but in our commerce, in our governments? We should be having these discussions - maybe it we did, we could avoid such boneheaded proposals as Paterson's in the future.

interstate78 wrote:

ya know, I don't think you can justify that. I can't believe enough people would leave for the measures not to benefit the state as a whole.

It's not just about driving people out; it's also about deterring people from moving in.

There will always be an apparently valid reason not to take action.

ah well.

Well this article's about these specific actions.

KaterinLHC wrote:
Certis wrote:
As usual, great writing Kat, but I have to agree with mateo, I'm not entirely comfortable with P&C op-ed pieces on the front page.

I find this stance a bit odd. Especially when the subject is directly related to a mode of commerce that is gaining a lot of ground in the gaming industry.

Or that it's okay to discuss certain political topics (e.g., Obama's stance on videogames) but not others.

As digital culture spreads, it will inevitably impact the flow of public discourse. We can't ignore it. In fact, I think we should welcome the discussions it spawns. What is the role media plays in our daily lives? Not just in our families or personal lives, but in our commerce, in our governments? We should be having these discussions - maybe it we did, we could avoid such boneheaded proposals as Paterson's in the future. :)

To be fair, I wasn't thrilled with the Obama piece either. I guess my problem with these types of articles is that they are really hard to do well without coming across as op-ed. While I agree coverage of digital rights, internet commerce and e-taxation are all important issues and deserve coverage from journalist from both large and small media, I'm just not sure that the front page shout be that forum. Your characterization of his plan as "boneheaded", while quite possibly accurate, might be perceived by some as discouraging debate on this issue. I would expect a less opinionated article on this or any other political topic to include at least a mention of a contrasting view or rational, after all, while many that visit this site might not agree with those who support digital taxation, it is something that generates a lot of support from brick and mortal small business who view the lack of taxes on e-commerce as unfair advantage for their competitors.

Just my two cents, if the Overlords see fit to make these topics a regular occurrence for the front page that of course is their decision.

So a writer can be opinionated about, say, Game Design or Dialogue Trees without a reasonable, opposing viewpoint but not anything related to politics? It's an editorial, so long as the opinion is well reasoned and supported, I'm not sure why the standards should suddenly be different. We're not purporting to be delivering the news here.

Sorry to belabor the point, but there's a wide range of issues and aspects to gaming beyond the simple act of playing and experiencing them. I enjoy looking at different elements of the industry and the world at large once in a while.

Great article Kat, I have to say I barely skimmed the responses. As a state gov't employee ( Executive Branch), here in KY, we're facing serious cutbacks. Our agency is being asked to make up to a 22% budget cut this fiscal year with no outlook for making up the revenue shortfall for the next few years, meaning we will be asked to cut back more next year and probably the year after. We'll be cutting staff and services soon. We're doing everything we can think of to cut the cost of doing business and not lay people off that have families and homes to maintain. So, I guess I'd like to know how it's better for government to tighten it's belt than it is for everyone to just pay a little more to keep the services we all rely on, like child protective services, temporary assistance for those who need it, and just keeping people employed.

I'd love to hear more ideas of how to stimulate the economy, but I don't see that gov't cutbacks are the only way. Government cutbacks still seem to hurt the little guy more than anything else.

Interesting article, thanks for bringing the issue of online taxation in the US to my attention. I think you undersold yourself by putting elaboration on the 4% tax ahead of the meatier parts, though.

There's no good reason not to tax digital transactions when you tax real-life ones. None, safe for impracticability. As far as I know, the European VATs work reasonably well because they are collected at a national level, a level that has to be considered by online retailers anyway due to the significantly varying legal situations in each country. A statewide tax seems to invite evasive (and economically inefficient) behaviour. The participation in a 'nexus' is impracticable for a whole category of enterprises enabled by online commerce.
The proposed measure would just not work.

Ultimately, government spending has to get it's money from somewhere. Traditionally, that has been through taxation. The question is, to what extent do you want to be taxed to have the government take care of things? In my mind, and as we see here, there isn't One True Answer to that. If you want bountiful government programs to take care of everything, then that has to be paid for. Less of your paycheck will be yours-- more of it will go to the greater good.

Where we tend to see friction is in two places. First, government tends to love the 'get now, pay later' system. This can take the form of taking out debt for current programs, or making large future promises, whether they be in the form of pensions, health care, or something else. Second is the desire for government spending to steadily increase, while the entity they tax is volatile. When the economy has a bad turn, and government hasn't created any slack, then there's trouble. This is when we start to hear these debates.

There is no right answer, but I do personally view less tax as generally better. Even the most well meaning government in the world simply lacks the knowledge to allocate capital efficiently. A less well meaning government may appropriate the money for their own aggrandizement. I'd rather empower private citizens to use their money as they see fit. But again, there is no perfect system. Welcome to the world.

Putting aside my moral indignation of having the State help me decide what to eat..

It isn't helping you to decide what to eat. It's looking to raise revenue via taxing consumption of something people like and will continue to buy even when taxed. They couldn't raise much money by taxing the consumption of brussel sprouts or broccoli, could they?

Also, it's surprising to see P&C brought out to the front page after spending years in Cleveland. Not complaining here- it's just like waking up one morning to find out that the president is a black guy. Who'd have thought?

Meh, I already pay taxes on my iTunes purchases and WoW subscription. The great state of Colorado has been taxing that stuff for a while now. To be honest, it's not that big of a deal. Of course, if you live here, it'd take a hell of a lot of taxes to overcome the allure of the mountains etc.

Times are hard, governments globally are desperate to find ways to enable their populations to survive.

A proposed series of taxes on luxury items strikes me as one of the better alternatives, better to pay more tax on your soda or music download than increase tax on bread. Money has to come from somewhere, sure, let government cut costs, but what happens when your car bursts a tyre hitting a pothole that can't be repaired due to budget constraints? Or poor maintenance leads to a town or cities financial sector blacked out for a week? These are issues I have faced in the last month, should the state of New York go in a similar direction?

Middle and upper class people really don't like sales taxes, because they are far harder to dodge than income tax.

People love a government or politician that talks tough on issues, until those issues effect them directly.

Somehow — it could only have been by mistake — we New Yorkers had acquired a frank, no-nonsense politician in our highest office. Someone who might actually understand what it takes to revitalize a dying economy.

Sounds a lot like the governor has had to make some tough choices for the greater good.

MrDeVil909 wrote:

Middle and upper class people really don't like sales taxes, because they are far harder to dodge than income tax.

Being in that group, I'd much rather have a consumption tax than an income tax. A consumption (sales) tax taxes everyone equally, and is thus relatively friendly to higher incomes. For that reason, sales tax is generally considered a regressive tax by the 'socially progressive' types, and they frown on it compared to other systems.

As for tax evasion, I hear about it a lot. I only know of two people who systematically try to evade taxes in a grand way. The vast majority of wealthy people I know in the US just pony up and play within the system. The US has put quite a bit of energy into cutting down on evasion, and if they determine that you are doing a transaction for the sole purpose of evasion, they will come after you for back taxes. I've heard more than not about people failing to evade taxes.

Poppinfresh wrote:
MrDeVil909 wrote:

Middle and upper class people really don't like sales taxes, because they are far harder to dodge than income tax.

Being in that group, I'd much rather have a consumption tax than an income tax. A consumption (sales) tax taxes everyone equally, and is thus relatively friendly to higher incomes. For that reason, sales tax is generally considered a regressive tax by the 'socially progressive' types, and they frown on it compared to other systems.

True, but aiming the tax at specifically luxury items does kind of weight it against people with higher incomes. Poorer people will be forced not to download their music, or drink too much Coke. people with more money, who will feel the effects less, will continue in their consumption.

Poppinfresh wrote:

As for tax evasion, I hear about it a lot. I only know of two people who systematically try to evade taxes in a grand way. The vast majority of wealthy people I know in the US just pony up and play within the system. The US has put quite a bit of energy into cutting down on evasion, and if they determine that you are doing a transaction for the sole purpose of evasion, they will come after you for back taxes. I've heard more than not about people failing to evade taxes.

Well, evade is a strong word. There are various vehicles available though that defer the payment of tax, sometimes indefinitely. There is no deferment of the price of your soda.