At least Susan Combs is paying attention to the needs of the state’s economy. With businesses struggling to understand, let alone pay, the confusingly complex new business tax, Comptroller Combs announced she’s giving everyone an extra month to make sense of what her office called “the complexity” of the new tax. That the new tax isn’t needed, and shouldn’t have been implemented to begin with, just adds gross insult to very real injury.
Legislators created the tax with the promise of cutting property taxes. Okay, stop laughing. They did cut the tax rate, but the rise of property tax burdens has continued unabated. Worse, the state’s surplus could have been used to accomplish the same feat, but legislators are loathe to separate themselves from even a single penny they’ve already collected from you. Hence, the new tax was created as yet another pipeline from which to drain ours wallet – hopefully without our noticing.
Businesses don’t pay taxes, people do. A business tax hides the cost of government; while the business writes the check, the burden is paid by business owners, investors, employees, and customers.
The tax was created by the Republican-controlled Legislature in 2006 over the objections of the conservative movement and the small-business-oriented National Federation of Independent Business. It was applied to business activity in 2007, and the first bill was to be due on May 15, 2008. But the legislature made changes to the tax in 2007, and forms weren’t even available until very recently. A good many businesses weren’t even aware of the tax, or their own liability, until recently.
Combs office put it mildly when they said the tax has “caused concern among tax practitioners and taxpayers statewide.” Some folks may be concerned, but even more are outright angry.
But that anger needs to be wisely directed. Susan Combs deserves praise for attempting to soften the blow.
I chatted last night with a CPA who said she felt the tax was already a disaster for the businesses she consulted, and would only be made more disastrous with time.
Lawmakers need to hear now from taxpayers that they expect to see the new tax tossed on the trash-heap of bad ideas. We’ve developed a short letter you can modify and sign electronically that we’ll print and hand-deliver for you at the Capitol to the state representative and state senator. You don’t even have to know your lawmaker’s name; we’ll add it for you.