Tag: taxes

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News The Fly-By

Rhodes Students Help Prepare Taxes for Low-income Residents

Tax preparation might appear dull on paper. But for Rhodes College Professor Ferron Thompson, who teaches a course called Taxation and the Working Poor, the memorable moments he’s shared with his students are too numerous to count.

“When a student comes back [to the same class] the second year and works without credit so that they can continue to give back to the community, that is a reward within itself,” Thompson said.

Thompson’s course, which is open to Rhodes students of all majors, began last spring with 32 students who assisted about 400 local, low-income taxpayers. Their work resulted in $762,000 in refunds and $120,000 in saved tax preparation fees. This year, 28 students have prepared 667 tax returns, which resulted in $1.6 million in refunds and saved people $150,000 in tax fees.

Most of Thompson’s students come through the door with little to no knowledge about taxation. Not only do those students learn to become certified tax preparers, they also examine how the U.S. federal tax system affects low-income communities while breaking down misconceptions about the lives of the working poor.

“A popular misconception is that the working poor are there by choice,” Thompson said. “[That] they are lazy and have no ambition to better themselves. The fact is that opportunities to change their ‘lot in life’ are difficult to find.”

A bulk of the required work is volunteering — filing community members’ taxes and preparing their returns. Students volunteer at the Binghampton Development Corporation, Ed Rice Community Center, Church Health Wellness Center, and Street Ministries. The program will soon expand to three additional sites.

“Very few students have had the need to take a look at taxation and how it affects them and others,” Thompson said. “The biggest stride we achieve is to make them aware of how taxes affect everyone in all walks of life with an emphasis on the working poor.”

There are three types of tax in Tennessee. Thompson said federal income tax has little effect on the poor: “They don’t make enough to be liable for tax under the current progressive system of standard deductions and exemptions.”

Payroll taxes affect everyone who works (the current withholding rates are 6.2 percent for Social Security and 1.2 percent for Medicare): “In theory, these are not true taxes as they do provide a future benefit to those who pay them. The way the Social Security system has been abused makes the assurance of those future benefits unknown at the present time.”

Lastly, there are consumption taxes (sales tax, gas tax, tobacco and alcohol taxes): “[These] by far have the most regressive effect on the poor and lower middle class. No matter the individual’s income, these taxes are assessed on consumption and therefore affect more adversely those making low incomes who consume all they earn.”

Avery Stewart, 22, a senior commerce and business major, previously took Thompson’s Individual Federal Income Tax class before enrolling in Taxation and the Working Poor. Stewart, who volunteered six hours per week and on multiple Saturdays, says the course gave her a new perspective.

“This course really makes you see how difficult it is for individuals and families, many of whom are working multiple jobs, to make ends meet and how much of a burden the taxes can be,” Stewart said. “It also makes you see how much of a difference a refund can make to an individual or family who needs it.”

What’s rewarding, Thompson said, is seeing students gain a better understanding of taxation methods and the obstacles some people face.

“I like to think that the students leave with a solid understanding of taxation of all types and how it affects all areas of our population,” Thompson said. “[The program does] no harm, only good.”

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Opinion

Council Searches for New Sources of Money

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It was late Tuesday afternoon, and the City Council was hoping to knock off a little early to get the jump on the Fourth of July holiday, but instead members wound up moving ahead on some taxing matters — as in sales taxes, gas taxes, and “voluntary” taxes on nonprofits and businesses that get tax breaks.

All of the matters are still in preliminary stages, so the votes Tuesday merely moved them a little closer to up-or-down final votes, or “third readings” as they are called. But the council seems to be serious about finding new revenue sources to balance the budget and keep from making cuts in services and employees.

Here’s a look at each possibility.

Councilman Shea Flinn, with the backing of Mayor A C Wharton, wants to give Memphis voters the option to raise the local sales tax from 2.25 cents to 2.75 cents, which would make the total sales tax 9.75 cents. Voters would have to approve it in the November election, but for that to happen, the council would have to take further action. On Tuesday the second reading of the measure was delayed. Flinn said he is fairly confident that the proposal will make it to the voters. But he also knows that some of his fellow members will not vote for it because they fear being branded as “pro-tax” which could make them vulnerable to future political foes.

Councilman Ed Ford Jr. wants to give voters another tax option — a one penny increase in the gasoline tax, with the increase dedicated to budget expenses for public transportation. This also has to pass council a couple more times, and there is some question whether the money can be given straight to MATA, which already gets millions of dollars a year in city funding. Like the sales tax, the gas tax has some appeal because it hits non-Memphians as well as Memphians, and is a “voluntary” tax to the extent that purchases can be controlled.

Councilmen Janice Fullilove and Lee Harris think the city should look at nonprofits and companies in Memphis that get tax abatements through the PILOT or payment-in-lieu-of-taxes programs. PILOTs freeze taxes at pre-development levels for a certain number of years. The nonprofits, Fullilove said, “use the same services” as tax-paying individuals and businesses. Boston and other cities have successfully persuaded “eds and meds” to make voluntary payments to help raise city revenue. The proposal is in the early stages in Memphis. A committee will be formed, but the idea has popular appeal as evidenced by the union lobbying for it at the unified school board meeting last week. The council won’t have leverage until the nonprofits and PILOT businesses come before it seeking something. Then we will see who’s serious.

Councilman Kemp Conrad wants members to approve an ordinance that would amend the city charter to require the mayor and council to adopt a five-year strategic business plan and a six-year consolidated operating and capital improvements budget. Wharton has floated a similar proposal, which is a favorite of business group advisers. The problem is that politics is always more or less a seat-of-the-pants operation. And over the years the council has yielded much of its authority to quasi-public agencies like the Riverfront Development Corporation to take over former city operations. Tax-cutters on the council regularly fall in line when the such agencies come around for their annual review and subsidy.

Give the council credit for this: On a day when many Memphians were leaving work early, they stayed well into the evening to do the people’s business. They voted against a special use permit for a pawn shop at Perkins and Knight Arnold, which is a serious issue for members and their constituents in urban districts. Harold Collins was especially blunt in his opposition, comparing pawn shops to blight.

The council had a healthy discussion of the dreaded car inspection stations. There is strong “feds be damned” sentiment to give all Memphians, not just poor people, a break on the annoying and expensive emissions-related “check engine” light breakdown. Inspection, of course, is as much an expenditure of time as well as money, and both investments can be considerable if the light-related problem has to be fixed in order to pass. Conrad spoke for many of us when he said “Anything we can do to get our citizens out of this ridiculous process, I’m for it.”

Finally, in the most touching moments of the meeting, the council and onlookers gave a very enthusiastic standing ovation to two people: Dr. Mary McDonald for her 35 years of stellar work with the Catholic Schools of Memphis and Deandre Brown and the members of Lifeline to Success, winners of the 2012 Large Group Volunteer of the Year Award. Some 25 members of the “Blight Patrol” in Frayser, all of them wearing lime-green t-shirts, came to the meeting and did a rousing group recitation of their “I am not my crime” coda, as Brown barked out the cadence. Members of the team, including Brown, are former criminal offenders looking to restart their lives in a Christian program working in one of the toughest parts of Memphis.

“You are the model for what this country should be looking for in a second-chance program,” said Council Chairman Bill Morrison.

Brown said he is determined to make Frayser “a nice place to live.” For more on his story, here is a Flyer interview done last year. Also see the group’s inspiring video on YouTube with the lines “I gotta clean up, what I messed up, I’m starting my life over again.”

Fine organization and good thought for everyone on this Fourth of July.

Categories
Opinion

City Council Chooses Reserve Funds Over Tax Increase

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Memphis property owners won’t be getting that “one time” 18-cent property tax increase after all, at least not for a few months.

The Memphis City Council voted Tuesday to use a combination of $10 million in reserve funds and $3 million in spending cuts to offset a $13 million deficit in the fiscal year 2012 budget. The 10-1 vote came on a resolution by Councilman Kemp Conrad which substituted for a property tax rate increase of 18 cents to replace general fund dollars already spent for Memphis City Schools.

The council is not as unified as the vote makes it seem. There is disgruntlement over Mayor A C Wharton and his administration for giving city employees $6 million in bonuses last December after saying the city had no extra money in its budget last summer. And there is unity in calling the now-rejected 18 cent tax increase “the mayor’s tax increase” as opposed to something the council came up with. But there are differences on the council that are likely to surface when the fiscal year 2013 budget is taken up in two months.

Budget Committee chairman Jim Strickland, for example, wants to see spending cuts and implementation of efficiency study recommendations. “Frankly, there’s been little action on saving money,” he said. Councilman Joe Brown wants the council to revisit the buyout for AFSCME workers.

Council chairman Bill Morrison said the measure adopted Tuesday “is just for the next three months.”

In June, the council could reconsider a tax increase as well as back payments to Memphis City Schools, spending cuts, and cuts in city employees and/or benefits to overcome a projected $47 million deficit in the next budget.

Categories
Editorial Opinion

Rethinking Education

It was not quite a year ago that a modest rebellion was mounted in the Tennessee General Assembly against the imposition of a 42-cent increase in the state tobacco tax, earmarked for education. The tax, pushed by Governor Phil Bredesen, went through but not without

opposition from some unexpected sources. Two of the holdouts were Shelby County Democrats Larry Turner and Mike Kernell, both House members of the governor’s own party but both determined to route the proceeds of the tax to health care. The idea was that money spent that way would have a more measurable effect than it would if channeled, as was finally the case, into the relatively amorphous agenda of the state’s Basic Education Plan.

This mini-rebellion might be regarded as the first faint sign of a political skepticism toward educational log-rolling that has since grown to heretical proportions. For generations, no cow has been more sacred than that of public education, a fact highlighted by the somewhat desperate 2001 proposal by former governor Don Sundquist for a state “reading program” as a backdoor means of getting the state income tax he felt the times required.

Now the revolt against indiscriminant educational spending has moved onto the agendas of cash-strapped local governments. While the Shelby County Commission listened sympathetically on Monday to county schools representatives who sought increased funding, mainly for mandated increases in teacher salaries, the commission, which has been deliberating on serious reductions in county government itself, put off a decision. Moreover, even commissioners who have favored educational spending in the past expressed resentment of the two local school districts’ support of what some called an “end run” in the legislature, where a bill to strengthen existing “Maintenance of Effort” legislation is pending. That legislation, if successful, would counteract the commission’s efforts, beginning last year, to curtail new capital construction.

The City Council, meanwhile, is considering the unprecedented step of withholding some or all of the almost $100 million it annually contributes to Memphis City Schools. While such a step would have seismic consequences on the MCS budget, it would be a catalyst toward the long-overdue consideration of single-source funding for the city and county schools and other administrative changes sought by a study headed a decade ago by Memphis businessman Russell Gwatney.

What Gwatney foresaw, even in rosier economic times, was the financial crunch that now afflicts both city and county schools, and he provided a recipe that involved both greater collaboration between the two local school systems and greater autonomy for each in responsibility for capital construction.

Perhaps it is time, as Tom Jones of the “Smart City” blog has suggested, to dust off that proposal. Perhaps it is time for new and even more innovative remedies. In any case, it seems certain that, at a time when property taxes have maxed out and declining property values are destined to result in shrunken revenues, something or somebody has to give — besides the already overburdened taxpayer.

Categories
Editorial Opinion

The Merger

All’s well that ends well, as the old saw has it. Since the bombshell news of a proposed merger between Delta Air Lines and Northwest Airlines began to leak only on Monday, it’s premature to forecast how it will end. For one thing, the two airlines bring to this marriage of

convenience two different sets of pilots, with two different seniority systems and other benefits packages, and all that has to be reckoned with before the merger is final. Then there’s the matter of possible obstruction in Congress.

Even so, the state of the troubled airline industry is such that the merger is likely to go forward. It promises to provide a real measure of stability at a time when a troubled economy has been causing numerous smaller airlines to collapse, domino-style. Not only would the new mega-airline, to be called Delta Airlines, be a force to reckon with domestically, it would span several continents and become, ipso facto, the world’s largest global carrier. And Memphians, who had been exposed nonstop to warnings that Northwest could yank or diminish its local presence, have been assured by the prospective new management that the city will retain its hub status in the newly configured monolith.

However things develop from this point, and whatever the shape of things in the end, local airport officials are expressing optimism. And, if nothing else, a period of prolonged suspense seems to be over with. For the time being, and, hopefully, for quite a while to come, all does seem well.

Budgeting Change

As we had been warned would be the case, both major local governments — those of Memphis and Shelby County — are facing either downsized services or up-sized tax rates, and, quite likely, some combination of the two. Both Memphis mayor Willie Herenton and county mayor A C Wharton had given ample warning of the bad financial weather, and both, in moving to deal with it, have continued to push for city/county consolidation as the only real long-term solution. But, to invert a familiar phrase, that will be then, this is now, and stop-gap measures have to be found.

Even as Herenton was preparing to call for a major property-tax increase on Tuesday, members of the Shelby County Commission were looking for constructive alternatives to another increase for homeowners. Various proposals were floated by commissioners at an unprecedented emergency meeting on Saturday and in a regular budget committee meeting on Monday. Looking for virtue in necessity, the commission considered everything from massive layoffs of county personnel to another rise in the already dreaded property tax — a remedy rendered even more questionable than usual by the currently flummoxed housing market.

In the process, they revived a formerly discarded and now-retooled proposal for a privilege (read: payroll) tax that would both exempt low-income earners and allow for the general property tax to be lowered. It’s worth a try, though the state has to give its approval to this county initiative. The city will shortly have to start its own head-scratching. Lots of luck to the members of both bodies.

Categories
News The Fly-By

Everybody’s Business

CREDIT: KURHAN | dreamstime.com

Several years ago, a Memphis distribution company had a problem. Because of a nearby traffic signal, cars backed up in front of the company’s drive, making it impossible for departing employees to turn left.

And while the employees might have been stuck, the company realized that it wasn’t.

“This was a major corporation, and they were ready to go to DeSoto County,” says Reid Dulberger, vice president over Memphis and Shelby County’s economic development program. “It’s the same everywhere: The little irritants become big irritants over time because no one is addressing it.”

The former head of the Youngstown-Warren, Ohio, Regional Chamber of Commerce, Dulberger was recently hired to run MemphisED, one part of the four-pronged Memphis Fast Forward Initiative. A combined initiative from Memphis Tomorrow, city and county government, and the Memphis Regional Chamber, the $66 million Fast Forward plan aims to create 50,000 new jobs within five years.

Though the chamber already had a business-retention staff, MemphisED gives additional funding to retaining and growing businesses in the community. Though it may not be as exciting or headline-inducing as a major corporation relocating here, Dulberger says it gets more bang for the buck.

“It’s less expensive to work with existing firms,” he says. “You don’t have to convince them about the value of your community. You’re not traveling to distant cities. You’re not producing expensive marketing materials.”

What it lacks in cost it makes up in labor. The MemphisED staff plans to do 400 site visits with local companies this year, with at least 50 of those visits being to minority- and women-owned businesses. And one may not think a traffic light has anything to do with economic development, but Dulberger would disagree.

“The business owners are saying, we’re here, we’re employing people, we’re paying taxes, and I can’t get the littlest thing done,” he says.

“To an adjoining community in another state, it’s an attraction project. The company is promised the moon and the sun. All of a sudden, they’re being shown a lot of love from another community. They feel like they’re being neglected by their home community — that’s a recipe for losing businesses.”

In the case of the distribution company, once the chamber’s retension staff became involved, the problem was corrected within a few days.

Fast Forward aims to create thousands of new jobs by focusing not just on businesses but on government efficiency, making the community one of the safest of its size and educating the local workforce.

“If this isn’t a safe community, we aren’t going to be creating 50,000 new jobs here. Or, if we do, the jobs will be here, but everyone will live someplace else,” Dulberger says.

Fast Forward has five main goals, 15 strategies for achieving those goals, and 12 partnering organizations, making it truly a joint effort.

“Even the city/county efficiency piece plays a role. The cost of government translates into our local tax burden,” Dulberger says. “To the extent that our local tax burden is high, it doesn’t make it any easier to retain, grow, or attract jobs.”

This isn’t the area’s first economic development plan, but it does represent a change. A study last year said that Memphis and Shelby County had one of the most underfunded economic development plans in the country.

When asked what is different about the current plan, Dulberger says simply, “It’s actually being implemented.”

The plan has both public and private funding behind it; the partners have already begun working on their individual components. The Musicians Resource Center is set to open in June. The Center for Emerging Entrepreneurial Development, an incubator for women- and minority-owned businesses in industries in which they are underrepresented, already has seven of its eight possible tenants.

“Getting a document together is not that difficult. If you have some money, you can hire a consultant, and you, too, can have a plan,” Dulberger says.

And he says that some communities have done exactly that:

“I suppose that will make our life a little bit easier, because it will make our competition that much less effective.”

Categories
Politics Politics Feature

A Tiff Over TIFs

Shelby County commissioner Mike Ritz is a first-termer who, on issues ranging from outsourcing Head Start programs to combating sexually oriented businesses, has indicated a willingness to stick his neck out. He is about to do so again.

This week, Ritz threw down the gauntlet against funding a developmental proposal which the University of Memphis is pushing hard and which Ritz sees as an out-and-out rip-off of the taxpayers.

The projec, approved by a 7-2 vote in committee Wednesday and up before the full commission next week, t would require TIF (tax increment financing) outlays for a portion of the adjacent Highland Street strip as a “gateway” to the university. The premise of TIF projects is that they generate significant increases in the tax base over the long haul.

“These TIFs are supposed to be used for public projects,” Ritz says. These include such things, as he has pointed out in notes sent to the media, as housing developments, street and sewer improvements, lighting, and parks.

But the Poag McEwen Lifestyle Center project on Highland, as Ritz sees it, is little more than a “gift” to the developers, who propose building a retail center/apartment complex on the west side of Highland from Fox Channel 13 north to the site now occupied by Highland Church of Christ.

“The University of Memphis is running interference for something that shouldn’t get done,” says Ritz, who maintains that the developers would be using a total of $12 million from the city and county and would be under no obligation to pay any of it back.

“There has been no analysis done on this project, and it contains no performance requirements,” says Ritz, who argues in his distributed notes about the project that “retail centers move sales and jobs around, they do not grow local economy; [there is] no growth of jobs or tax base.” In a conversation this week, he added, “It’s like moving checkers around on checkerboards. There’s no lasting benefit.”

Ritz’s statement of concern comes on the heels of two new reports.

One report from county trustee Bob Patterson notes that 120 local companies have tax freezes under PILOT (payment-in-lieu-of-taxes) programs and that some $44 million worth of county property taxes and 372 parcels of land are involved in the programs.

Another report, from the Memphis and Shelby County Industrial Development Board’s performance and assessment committee, indicates the likelihood of default by several corporations on obligations relating to their tax breaks under PILOT programs. Under the circumstances, Ritz says, the Highland project amounts to an additional “giveaway” which the county simply can’t afford.

University of Memphis officials have been aggressively promoting the project as a way of shoring up the university’s “front door.” One who concurs is veteran U of M booster Harold Byrd, who has had his differences with university president Shirley Raines concerning her lack of enthusiasm for an on-campus football stadium, of which Byrd has been a strong proponent.

But Byrd says he’s on “the same page” with Raines about the Highland Street project. “It would shore up an area that, particularly south and west of campus, has begun to deteriorate.” Citing what he says is a prevalence of “cash-for-title businesses, pawnshops, and fortune tellers,” Byrd says, “It’s definitely a distressed commercial and retail area.” Moreover, he says, “the residential area south of the university is in strong decline.”

Both circumstances would respond positively to the proposed Poag McEwen Lifestyle Center, he said, and the “gateway” aspect of the project would benefit the entire community, not just the university area itself. (For more on this perspective, see In the Bluff, p. 10.)

On the first round on Wednesday, the Highland TIF project, which has the imprimatur of the Memphis and Shelby County Redevelopment Agency, got preliminary support on the County Commission, too. The 7-2 vote in favor (Wyatt Bunker joined Ritz in opposition) came despite a recusal from Commissioner Steve Mulroy, a University of Memphis law professor.

The commission is scheduled to take up — and approve — the measure on a formal vote next week.

• This coming week sees the formal completion of the 2007 Memphis election cycle, with four City Council runoffs being decided on Thursday, November 8. The contests are between Stephanie Gatewood and Bill Morrison in District 1; Bill Boyd and Brian Stephens in District 2; Harold Collins and Ike Griffith in District 3; and Edmund Ford Jr. and James O. Catchings in District 6. Pre-election updates,as well as full coverage of the results, will be posted on the Flyer Web site and in next week’s print issue.

Categories
Editorial Opinion

If It Is Broke, Fix It!

One of the most tiresome aspects of the current political situation in this country is that our two major political parties — which, until quite recently in our history, were aggregates of various constituencies, not ideological monoliths — now oppose each other almost solely on the basis of catechisms.

Nowhere is this more odious than when it comes to dealing with taxes and government expenditures. Everybody on both sides toes a party line. Though few Democrats like to admit it, their party has indeed, as the rival GOP charges, been too dependent on throwing money at intractable social problems. A case in point was the debate in the Tennessee General Assembly this year, in which the Democrats, at Governor Bredesen’s behest, insisted on routing an expected $230 million tobacco-tax windfall into state education. The state House of Representatives’ Republicans proposed a panoply of amendments whereby the money would go to this or that alternative worthy cause — eliminating the sales tax on groceries, for example. Unfortunately, it was generally recognized that the GOP’s strategy was to get the bill amended so it would have to be approved all over again in the Senate — where the Democrats at the time happened to have a couple of absent legislators. Meaning: disapproved. The sad fact is that too many Republicans think no public money is ever required to do anything at all.

Though here and there some brave and independent souls — Democratic state representatives Mike Kernell and Larry Turner of Memphis were two such — broke with party discipline (in their case, to advocate a serious catch-up program in health care), the argument came down to My Pork versus Your Pork. Or more precisely, Pork vs. No Pork. And, nationally as well as statewide, variants of that argument continue on a more or less party-line basis. (See Preston Lauterbach’s “Pork Product?,” on p. 11.)

But maybe the recent bridge catastrophe in Minneapolis will be a prod to both parties, as the Gulf Coast’s devastation by Hurricane Katrina was — or should have been — in 2005.

Unfortunately, not much has been done to amend the still perilous circumstances facing New Orleans and the rest of the Gulf area. The current national administration seems to believe that Katrina was a freak event, not due to be repeated for another thousand years or so. (That’s one thing that comes from a willful disbelief in global warning.)

But, encouragingly, Minnesota governor Tim Pawlenty, who only a month ago was basking in the praise of his Republican colleagues for refusing to approve two different tax proposals to fix his state’s aging infrastructure, has experienced a sudden enlightenment as a result of the lethal collapse of the Interstate 35W bridge. “He’s open to that” is what a spokesman for the governor now says about a new tax for repairing infrastructure.

To paraphrase the poet Schiller, he comes late but he comes. Hallelujah! Having just learned from the federal government’s latest National Bridge Inventory that no fewer than 150 bridges right here in Shelby County are adjudged to be either “obsolete or deficient,” we’d just as soon that our own state government rethink its own priorities — free from all the tired old arguments about “pork” and taxation.

We live here, and we happen to think public safety is worth paying for.

Categories
Editorial Opinion

What Gives?

Three members of the Shelby County Commission cast votes Monday for a proposal that may be good politics but makes for unsound public policy. This initiative — for a five-cent across-the-board reduction in the county property tax — came from Wyatt Bunker, who represents the county’s suburban and rural edge and its ideologically conservative edge, as well.

According to Bunker, the proposal, if enacted, would have cut $8 million out of county revenues for the next fiscal year — although the commissioner maintains that such a cut would, sooner or later, raise revenues. Right. The same logic pursued by the relentlessly tax-cutting Bush administration has driven the national deficit to new historical heights.

Various of Bunker’s commission colleagues expressed exasperation with the proposal, especially since A) it came just after a tense debate concerning the commission’s need to divert wheel-tax money originally earmarked as operating funds for the schools into the county’s general fund, where it can be tapped for future capital improvements, and B) it followed weeks of a painstaking budgetary process, now concluded, in which every stray corner of county government was scrutinized for real or potential waste.

Yet, two other commissioners, fellow suburbanite George Flinn and Chairman Joe Ford of Memphis’ inner city, joined with Bunker in voting for the proposal which, had it passed, would have thrown county government back to square one in its financial planning for the next cycle.

What gives? Well, the legitimate needs of the taxpayers would have been first. As several commissioners pointed out, the needs of the schools would have come asunder, closely followed by law enforcement. It made a certain political sense for Bunker and Flinn to vote the way they did, since they represent (or believe they represent) constituents who favor tax cuts at all costs. But what was Chairman Ford, who normally balances policy and service needs with the legitimate requirements of fiscal solvency, thinking?

Ford, who must have known the discussion and the vote were pro forma, urged Bunker to reintroduce the proposal next year. Fair enough. At least that will give the commission enough lead time to reorganize fiscal priorities so as to facilitate such an across-the-board cut, if that’s what they regard as needful. Given Governor Bredesen’s success in imposing drastic cuts when he took office in 2003, we’re not saying the idea of an across-the-board cut is impossible. But the last time we looked, the governor was taking some criticism of policy changes (his gutting of TennCare, for example) that we regard as legitimate.

Property owners are surely entitled to relief and deserve consideration of the sort just awarded in Nashville, where state senator Mark Norris and state representative John DeBerry won passage of legislation authorizing the state’s local governments to enact limited tax freezes for seniors.

Those eligible in Shelby County are homeowners at least 65 years old with incomes not exceeding $31,549. That amounts to 59 percent of the county’s senior households and is consistent with Shelby County’s unique need for balance between revenues and services. When it can, the commission should act upon the new law. Anything more drastic will have to wait.

Categories
Opinion Viewpoint

Tax Season

“I hate to be the one to remind you, but pretty soon it’s going to be April 15th — tax time. You know what I am saying? Are you ready? Well, you know when something like this happens, New Yorkers always try to put the best face they can on a situation. For example, the hookers in Times Square: For an extra $50, they will handle your extension.” — David Letterman

The best part of spring just ended — the NCAA basketball championship and the Masters. Now comes the bad part — pollen and tax time. This year, we are measuring pollen by the inch here in Atlanta, but it is not near as annoying to me as paying this idiotic government’s ever-increasing taxes.

April 15th is when people like Kevin Federline have to answer awkward questions like “Occupation?” George Bush should have to answer a similar question: “Why Occupation?” (In the most expensive political/social-science course of all time, we have spent $500 billion just so our government could learn that Shiites and Sunnis will never ever get along.)

The Republicans, who say they are the party of limited government, created the second-largest entitlement of all time with the prescription-drug-coverage giveaway. As it turns out, the giveaway was mostly to drug companies who, through spending a ton of money on lobbying Congress, do not have to compete on prices any longer. The drug lobby actually hired the congressman who ran this bill through Congress — right after it passed — and is paying him $2 million a year. I need a Prozac.

With all their goof-ups and lack of truth in advertising, the GOP has left the door open for the classic tax-and-spenders, the Democrats. It is a given that we are not going to get a tax break under Hillary Clinton, who has already picked out her inaugural pantsuit, she is so sure she will win in 2008. Her Thighness will not be concerned about the high taxes we pay. She only wants to raise taxes and redirect the money.

And there will be more gas taxes, created by Democrats out to stop the bogeyman called Global Warming. Currently, the villains — oil companies — make about 10 cents a gallon profit on gas. The government takes about 40 cents a gallon. Expect that to get worse. It will drive me nuts when the Democrats take charge. I fear that I may get suicidal and throw myself under an oncoming glacier.

The federal budget is more screwed up than Paris Hilton’s checkbook. We have an incomprehensible, lobbyist-written tax code that costs us $195 billion a year to comply with. Many in our society, of course, do not pay anything.

The top 1 percent of taxpayers accounted for 37 percent of all taxes paid in 2005, up from 34 percent in 2003. The top 5 percent of taxpayers, those with around $130,000 and above in income, paid 57 percent of all collected taxes. The bottom 50 percent paid only 3 percent. I find it amazing that people think that somehow upper-income people are not paying their fair share. My fear is that they will leave the country and stop supporting the rest of the United States.

The only answer is the “fair tax.” It abolishes the IRS and collects tax at the point of sale. The IRS has a 10-billion-dollar budget and four times as many employees as the FBI. If the fair tax gets enacted, we would no longer have to file tax returns. Only the IRS could devise a system whereby we are forced to predict how much tax we owe by guessing how many dependents we should deduct. Somehow, the government views children as deductions, while most of us who are parents view them as taxing.

As for me, I am just going to claim one dependent this year: the U.S. government.

Ron Hart is a libertarian and an investor who lives in Atlanta. His e-mail is RevRon10@aol.com.