Busted budgets: states desperate for new taxes - Garry Reed

News & commentary from the liberterrain…

California, struggling with budget deficits, growing debt, and possible bankruptcy, has been seriously considering legalizing their $14 billion per year cash crop, marijuana.

A bill in the state’s Assembly would impose a $50 per ounce fee on legal sales, bringing in “nearly $1 billion a year” depending on which expert’s opinion gets quoted in which newspaper.

In Colorado, candy and soft drinks are legal but they’re exempt from the state sales tax.

The Centennial State, having already closed a $2.1 billion budget gap, faces a billion dollar shortfall in next year’s budget. The state’s politicians see a 2.9-percent “Twinkie Tax” on sweets as a way to sweeten the public pot. A bill to do just that passed the House Monday and, if approved by the Senate, is expected to raise “3.58 million this year and $17.9 in 2011.

In January, New York Governor David Paterson, staring a $7.4 billion deficit in the face, went looking for $1 billion in new taxes and fees even after carving out nearly $800 million from New York City and slashing other taxes.

A $1 tax hike is proposed for that old favorite of politicians everywhere, cigarettes, which will raise a pack to $3.75. Other proposals include a 1-cent per ounce soda tax, legalizing and taxing cage fighting, collecting more revenue from wine by allowing sales in grocery stores, and introducing 50 new speed cameras to catch and fine motorists as much as $100 (thereby belying the claim that speed cameras are justified purely as a “safety” concern.)

Commentary…

So what will happen if California and Colorado and New York and every other state with fiscal afflictions get the increases they want? History tells us that in a year or so they will each spend 150% of their new taxes, face yet another fiscal emergency, and go looking for more things to tax.

Giving more tax money to politicians is like giving a shot of José Cuervo to a stumbling blind slobbering drunk.

They could tax everything in the country with a pulse and never have enough money.

(Or, as libertarian columnist, editor, and author Vin Suprynowicz recently put it, “If you pay taxes, you’re ‘rich,’ so you should expect more taxes.”)

Anyone who believes that politicians and taxes can ever solve any problem anywhere is in greater need of rehab than the tax-addicted politicians or the alcoholics they mimic.

[Via http://marinlp.wordpress.com]