04/ 02/ 2008
NFIB knows a tax by any other name is still an increase in your cost of doing business
States in the mid-Atlantic and Northeast face budget deficits and have constitutional requirements to balance budgets. So legislators are either casting the tax net wider or getting creative with finding new sources of revenues, leaving NFIB staff with no shortage of battles to fight on our members' behalf if these ideas spread around the country.
For example, Gov. Elliot Spitzer of New York proposed a budget that would raise taxes by $923 million. Among increases such as a $2.54 per gallon excise tax on flavored malt beverages and classifying little cigars as cigarettes, he wants to create a new vendor registration that would require all of the state's 600,000 sales tax vendors to re-register and pay a $50 registration fee.
Further north, Vermont's administration proposed to eliminate a tax exemption on the first 40 percent of capital gains for all taxpayers except senior citizens, leaving only a $2,500 exemption for remaining individuals and businesses.
Everything is considered to be on the tax table in Rhode Island, including hiking the capital gains tax, expanding the sales tax and a proposed gross receipts tax on accounting and legal services.
Massachusetts is considering eliminating a cap on annual municipal property tax increases. And despite a January pledge to avoid tax hikes, Maine Gov. John Baldacci has said that everything is now on the table, while state Senate leaders support cutting tax incentives for business investments.
Some states, such as Pennsylvania, have a projected surplus. Nevertheless, Gov. Ed Rendell proposed $230 million in new taxes, including a tax on electricity and new taxes on property insurance premiums.
These examples are only a few of the reasons why NFIB must continue to explain to legislators that small businesses are the ones creating jobs in this economy, and--whether you call them taxes, fees or anything else--these costs ultimately hurt economic growth.
