Governments are raising taxes for a specific period of time and promising the hikes will go away when good times return.
Some big temporary taxes:
•Arizona voters decide today whether to approve a three-year sales-tax hike. Republican Gov. Jan Brewer pushed to raise the sales tax from 5.6% to 6.6%, dedicating two-thirds of the new money for schools.
•Kansas hikes its sales tax July 1 from 5.3% to 6.3% for three years. The tax is designed to prevent cuts in education and social programs.
• Mobile, Ala., boosts its sales tax by 1 cent for 16 months starting June 1. The combined state and local rate will be 10%. Goal: avoid laying off police and firefighters.
A half-dozen other states are eyeing temporary taxes. So are many cities and counties, including King County, Wash., which includes Seattle.
Temporary taxes are phenomena seen during recessions, says Curtis Dubay, a tax expert at the conservative Heritage Foundation. “You don’t hear about temporary taxes when money is flowing into the coffers.”
The problem is that these taxes rarely go away, he says. “Once politicians get their hands on revenue, they won’t give it up,” he adds.
I noticed that Stan, a resident of Arizona, wrote about an alternative to temporary tax hikes in this post.
Let’s see what the official 2010 budget says. Hmm. Well, they’ll be paying back $50 million in Federal Stimulus money. Odd. There is a line item for an additional $40 million in “new private prison beds”. Right … so our criminals are more comfortable. Got it. Interesting. There is a “Department of Racing”. Apparently the Department of Racing regulates the Arizona parimutuel horse and greyhound racing industry. Oh, now this is funny. The Department of Economic Security has a budget of $546 million. Perhaps we ought to fire them, eh? While we’re at it, perhaps we ought to take a real hard look at the Governorʹs Office of Strategic Planning and Budgeting and their $2 million. I’m thinking they’re not doing their job. Oh, I suppose there is no way around the $2 million we’re spending on the Board of Cosmetology. I mean, what could be more important to Arizonans than beauty treatments. Oh, yeah, we have to regulate that carefully. There’s another $4 million on a “Telecom for the Deaf Fund”. I know … that’s a good thing … but is it more important than public safety? Is that really the job of the government? And the fact that we’re spending more than $13 million on a “Department of Gaming” (with another $74 million to the Arizona State Lottery Commission) is troubling to me all on its own.
Allegedly something around 60% of our budget is already spent on schools and public safety and health care. Fine. But is anyone looking at what that money is going toward and how to cut waste? Trust me. There is lots of waste.
Overspending governments always market tax hikes as ways to say essential services or “compassionate” social programs. Why can’t they just cut some wasteful spending, instead? Is that so hard?