Monday, March 16, 2009

Only in California: Proposed taxes on marijuana, pornography

Having run out of normal things to tax, the welfare state of California is turning creative. From the San Francisco Chronicle (also known as Chronic-ill):
Less than a month after the Legislature approved more than $12 billion in tax increases to help bridge a $41 billion budget deficit, Democratic lawmakers have proposed more tax and fee measures they say would curb devastating cuts to state programs.

The proposals include a 25-cent fee for shoppers who use plastic bags; a tax on cigarettes to fund programs discouraging tobacco use; a $50 per ounce tax on marijuana; a higher income tax for the rich to help pay for schools; a tax on oil produced in California; and a tax on pornography.
If the object of taxes is to raise money, rather than to reform people, does it make sense to tax cigarettes so you can fund programs to discourage people from using them, thereby reducing the tax income?
"I think we're in a period in time where everything's on the table. We're going to be $8 billion down before the ink dries on the current budget," said Assemblyman Curren Price, D-Inglewood (Los Angeles County). …

"Education should be our prime priority," Price said. "We frequently are shipping funds away from education. My proposal is one way of ... trying to insulate education funds from those kinds of cuts."
Mr. Price, "prime priority" is redundant (as is "period in time"), suggesting that you suffer from a California education. That aside, you are no doubt aware that Hispanics make up 47 percent of the students in California, thanks to the Liberal Establishment's policy of population replacement. Being a politician, however, you could not be expected to suggest that closing our de facto open borders and encouraging illegals to return to Mexico could help the Golden Fleecing State reduce its budget shortfall in no small measure.

But California is Obamanation in its purest form: No Voting Bloc Left Unbribed. Gold nuggets for all! Bring your extended family! Excellent taco vending locations available! Sign here or make your mark, and watch those public assistance bennies fly to your mailbox and the nearest maternity ward.

So — no tax too big, no tax too small. Sorry, some taxes too small, but we'll fix that. Here is the Chronic-ill's list of Cali-form-ia legislators' newest suggested barrel scrapings:
AB87 (Davis)/SB531 (DeSaulnier): Fees for shoppers who use plastic bags.

AB89 (Torlakson)/SB600 (Padilla): Increases the cigarette tax.

AB390 (Ammiano): $50-an-ounce tax on marijuana, which would be legalized for recreational use.

AB462 (Price): 1 percent income tax for individuals who earn more than $1 million a year, to fund public schools and universities.

AB656 (Torrico): Oil severance tax to help fund the state's community colleges and universities.

AB1019 (Beall)/SB558 (DeSaulnier): Tax or fee on alcohol.

AB1082 (Torrico): Sales tax on pornography.

AB1342 (Evans): Cities and counties would be allowed to raise income taxes and vehicle license fees.

SB96 (Ducheny): Increases the income tax rate on the state's wealthiest residents while lowering the rate for some middle-class taxpayers.

If you're a "comfortably off" California grass-smoking, booze-drinking, car-owning consumer of pornography who sometimes forgets to take your organically-grown-natural-fiber Green Bag to the grocery, prepare to be a proud supporter of the state that never met a spending bill it didn't like.

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8 comments:

Anonymous said...

Most of those taxes look ridiculous and annoying, but the tax on marijuana seems sensible. Sometimes the crazy SF liberals get something right. As long as marijuana is illegal, the Mexican drug cartels will prosper, and this includes destroying acres of national parks for marijuana plantations. Small local growers are often pleasant suburbanites--I've known a few, though I haven't been a customer in 30 years or so. I don't really like the idea of taxing a cottage industry that's similar to growing tomatoes and trading them with friends, but OTOH, this is probably the only way to end prohibition.

Terry Morris said...

If the object of taxes is to raise money, rather than to reform people, does it make sense to tax cigarettes so you can fund programs to discourage people from using them, thereby reducing the tax income?

Of course not. But the purpose of taxing cigarettes is not to reform anyone. That's just the official line they use to justify doing so because stating the truth, the whole truth, and nothing but the truth wouldn't fly with most folks, and they know it.

But like I've said elsewhere, there is a limit to how much government can tax individuals, which, when exceeded will result in the collection of less revenue to the state, not more, particularly over the long haul. (The federal government just imposed an additional tax on cigarettes amounting to about a dollar a pack I think.)

California has definitely crossed that rubicon, and I even think my state, Oklahoma, has also done so in certain areas, cigarette taxes being one of them. The only difference in the two is that Oklahoma levied its newest tax on cigarettes during comparatively good economic times, whereas California, as perhaps evidence of its government's utter incompetence, is proposing to do so when the economy is in the tank and people, as a result, are in the very process of cutting out or greatly reducing their usage of non-essentials.

You can't squeeze blood from a turnip, as they say, nor can you tax individuals beyond their ability to pay them. It's a hard lesson that California will have to learn the hard way, I guess. Besides, isn't tobacco sales a staple of certain Southern economies?

All hail the "sin tax"!

Rick Darby said...

Latté,

Agreed. The "war on drugs" as we are pursuing it can't be won. It goes on and on because there are so many people whose jobs depend on this quixotic crusade.

By the way, I have tried to comment on your site and can't make it work. When I hit preview or send, the message disappears. Has anyone else reported this? What am I doing wrong?

Terry,

I expect most of these proposals are just blowing smoke, so Democrats can say, "We tried to balance the budget, but those Republicans wouldn't let us."

You are right that there is a limit beyond which taxes cannot be raised. The poor will join the underground economy, off the books. The rich will move out of the state or hire accountants and lawyers to find ways of avoiding taxes they consider excessive.

Anonymous said...

Rick, I don't think my main blog (@ blogspot) has a comment problem. The only thing I can think of is, do you mean my WordPress blog? That's only for backup in case Google puts a content warning on my site, as has happened to several blogs I read. The reason I blocked comments on my WordPress mirror site is that it attracted anti-Auster rants from the usual suspects, who thought I wouldn't notice.

Rick Darby said...

Latté,

On the "Select Profile …" menu I select Name/URL, type those in, type the comment, hit either Preview or Post, and the original field reappears with no comment.

David Foster said...

If California wants to tax oil being sent *out* of the state, then maybe other, nearby states should be taxing electricity sent *into* California.

Anonymous said...

Thanks for letting me know. I'll reload the template, that may fix things.

Anonymous said...

California tax proposal would cost smokers another $1.50 a pack
12:23 PM | March 10, 2009
Just weeks after state lawmakers agreed to boost the sales tax and vehicle license fees, two state senators proposed today that the tax on cigarettes be increased by $1.50 a pack.

Such a hike would raise $1.2 billion a year, most of it for routine state services. But 15% of the money would be spent on lung cancer research, efforts to reduce tobacco use and enforcement of tobacco laws. The proposal came from state Sen. Alex Padilla (D-Los Angeles) and Senate President pro Tem Darrell Steinberg (D-Sacramento).

The measure is part of a package that includes a proposed ban on the sale of tobacco within 1,000 feet of schools and at retailers such as video stores, doughnut shops and other settings that attract children.

"Despite existing laws that prohibit the sale of tobacco products to minors, children continue to buy tobacco products," Padilla said. "Three out of four smokers start before they are 18, and one of three youth smokers will eventually die prematurely from smoking-related illness. California needs to do more to keep tobacco away from kids."'

Padilla said the proposal would require a two-thirds vote of the Legislature.

He said California has one of the lowest tobacco taxes in the nation, an 87-cent-per-pack levy that ranks the state 30th. Boosting the tax to $2.37 would make California's the fifth-highest tobacco tax in the country.

Padilla said that about 4 million Californians smoke. But even though the increase would be a "sin tax" not affecting most residents, the proposal is already drawing fire from taxpayer advocates.

"How [much] can you tax a particular product of this kind and not end legitimate purchases and force it underground?" said Lew Uhler, president of the National Tax Limitation Committee. Uhler said he does not smoke.

Other proposals made today would stop the issue of new tobacco-sale licenses in neighborhoods where there are already too many tobacco sellers and would cap the number of tobacco licenses that could be issued by the Board of Equalization in a year.

-- Patrick McGreevy