Wednesday, April 22, 2009

Revenue Week Working?

It's Virtual Rally Week for those sane enough to realize Massachusetts has to do something about the revenue situation -- well, the distinct lack of it. It looks like DeLeo got the message. Unfortunately, the income tax is off the table. It's the tax that's the fairest and probably most efficient in terms of raising revenue, but what can you do? If everything else is at least open for discussion, that's not so bad.

Would the Speaker like Ryan's Risk-Adverse Advice for Raising Good Revenue Streams? People are demanding answers to municipal budget collapses and the transportation system, so here goes.
  • Solving the multi-faceted transportation mess: Pass a 20-25 cent gas tax, which would do enormous good and only cost the average car-driving taxpayer about $100 a year. Include money in that to get rid of most tolls (8-11 cents, with 10 or 11 cents getting rid of *all* of them) as well as public transportation (8 cents = $200 million). Make sure revenue from the gas tax is spread fairly throughout the state, whether it's closing tolls, paving roads or keeping the buses going.
  • Helping cities and towns: 1. Close telecom corporate tax loopholes by allowing towns to tax Verizon for all its telephone polls, as they already do cable companies. 2. Get rid of most of the home-rule stuff, so towns aren't handcuffed. 3. Give munis the option to pass modest local sales taxes on hotels and restaurants (and maybe even more) at no more than 2%.
  • Helping the State Budget: We can't just cut ourselves out of this current hole. We've made too many cuts already. At the very least, pass Patrick's candy and liquor tax proposals. Those seem like no brainers. They're also completely discretionary spending and thus a much fairer tax than a general sales tax. This is real low-hanging fruit stuff, but it would raise real revenue. Plus, why should cigarettes have a huge tax rate while alcohol isn't even hit with the state sales tax? Seems bizarre.
  • Reasonable efficiencies to state government: Pass the Governor's harder-hitting pension reform proposals. Moreover, get major public-employee unions to the table with the Gov, Senate President and Speaker to talk fair ways to save money and jobs by switching to GIC or other regional plans in every single city and town where that makes sense. There's hundreds of millions to be saved there - and plenty of common ground to be had. Do it. It's the duty of our elected leaders to act like adults and get these unions to the table, so we can access these savings throughout the state.
Aside from perhaps the gas tax, Ryan's Risk-Adverse Advice for Raising Good Revenue Streams won't piss off any serious group of citizens. Carla Howell may blow a gasket, but her minions won't be on the march because suddenly Verizon has to pay property taxes on its property. Hence why this plan is so risk-adverse -- these taxes aren't going to be noticed. They're not large and most can't be blamed on the State House, as they'd now be local issues.
Even the gas tax, combined with pension reform at our state's transportation authorities, would be tolerated by the general public with even the smallest of public awareness campaigns. Plus, even a 20 or 25 cent gas tax won't be noticed or thought of at length after a few months. Phase it in over a year or two and maybe no one notices at all?


Anonymous said...

Tax Verizon and guess who pays the bill? The ratepayer. In other words, your phone bill goes up. Just movin' money from one pocket to the next. Next idea.

Ryan said...

Um, not true. If our zero-tax status to Verizon were so beneficial to telecoms, why do we have some of the highest telecom rates in the country? Other states have this tax, including expensive-to-live-in states, whilst having lower telecom rates.

Furthermore, if telecoms were taxed on these lines it would be an absolutely miniscule percent of their overall profits. There's no indication that it would result in those expenses being passed off to the consumer because of the steep competition Verizon has with Comcast, who already pays these taxes. Even if it did, it would be a tiny, tiny some - whilst providing a huge new revenue source for municipalities. No matter how you slice it, this is a good policy decision. There's a reason why we're the only state in the country with this corporate loophole - and, honestly, it's an unfair advantage to Verizon that Comcast doesn't have...or you and me (I've love to have no property taxes, after all!)

Anonymous said...

It will be interesting to see if our officials (every branch is controlled by the Democrats) are willing to try and tame the greed and avarice of these public/semi-public employee unions. That is the rock solid base of their support. The rest of the taxpayer base has been squeezed and may now be at the breaking point. As the Chinese say "May you live in interesting times".

Anonymous said...

You have your head buried up your arse if you do not think these costs get passed on you consumer. It's simple economics. If you are looking for budget flexibility at the local level reform, reform, reform.

And stop with the bullshit state programs that suck us all dry.

Anonymous said...

pffff - nice try

nice try

Ryan said...

Anon 8:31, so I guess competition as an economic base doesn't work?

That said, I never said we wouldn't have some of the costs brought to us. But these are very small costs -- and we're paying them now anyway, through *higher property taxes* because Verizon doesn't have to pay their's.

This very small amount, proportional to Verizon's overall Mass. profits, may or may not be totally passed on to the consumer. Verizon must weigh the potential cost of the tax versus lost costumers should they raise rates to make up the difference. It would probably be something in between. But as I said, it's such a small number divided up by all of Verizon's costumers that it may mean the difference of a few cents on your bill... cents you're already paying in higher property taxes, because we're all subsidizing Verizon through this loophole.

Anonymous said...

Why not cut the waste, fraud, corruption, nepotism, etc.?

Ryan said...

We are cutting the waste, fraud, corruption, nepotism, etc. The bills are floating around and one of them will be signed this year.

But they won't solve our fiscal woes, at least not alone. That's why we must pursue some reasonable new revenue options.

Anonymous said...

Because of the afforementioned waste and corruption, people like me to not trust the goons on Beacon Hill. Thus we are left to stare at each other and the Beacon Hill bunch will continue to fuck it up with watered down reform

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