Washington State Budget Proposal and Stupid Taxes

[Ryan A]

Reason Number 1,964 I hate politicians (http://seattlepi.nwsource.com/local/aplocal_story.asp?category=6420&slug=WA%20XGR%20Chili%20Tax). Seriously.. I love my SPAM musubi -- why go and raise the tax on it?

[Bullhajj]

I hear about spam so much, but rarely do I ever think of tinned meat products anymore. Sort of a walk down nostalgia lane. Thanks!

[Jason McCullough]

If you read the artilce, they're doing this in reaction to a WA Supreme Court ruling that non-perishable meat products should have the same tax rate as perishable meat. They're raising the rate back to the pre-ruling one. It's not a sin tax.

See court case here: http://www.awb.org/cgi-bin/absolutenm/templates/?a=839&z=2

The Association of Washington Business (AWB) and its longtime member Nalley’s Fine Foods scored an important victory today at the Washington state Supreme Court.

The Court ruled in favor of Nalley’s in a dispute with the Department of Revenue (DOR) over the appropriate tax rate for its manufacturer of perishable food products. The DOR claimed that Nalley’s chili should be taxed at the higher rate because the end product is a nonperishable item, not a perishable meat product. Under Washington’s Business and Occupation (B&O) tax statutes, a general manufacturer is taxed at three times the rate of a manufacturer of perishable meat products.

DOR argued that taxation on manufacturers should be on the end product of manufacturing, not the process or activity of manufacturing. Moreover, the Department argued that as between two different tax rates, the lower rate constitutes a “tax preference” that should be narrowly construed against the taxpayer. Nalley’s prevailed over DOR at the Superior Court level, but the Court of Appeals sided with the Department. Nalley’s took the case to the Supreme Court, resulting in this morning’s favorable opinion. AWB joined the fight in support of employers and manufacturers.

Pretty funny when you just write it out as "tax increase on Spam," but not really accurate.

[Linoleum]

Pretty funny when you just write it out as "tax increase on Spam," but not really accurate.

Yeah, especially when all the rich are eating that sweet sweet Armor potted meat food product!

[Jason McCullough]

Not like any kind of sales taxes are paid by the rich, really.

[Nick Walter]

Not like any kind of sales taxes are paid by the rich, really.

Be careful with statements like that, you just open yourself to those who triumphantly claim that the rich pay more than their "fair share" of sales taxes because the sales tax on a BMW is higher than the sales tax on a used ford escort.

[Ben]

Well, I think I know what McCullough meant, but what he actually said was wrong.

Sales taxes aren't paid by the rich? What, do you show the clerk last year's W-2 and get tax-exempt status if your income is high enough?

[Jason McCullough]

Sales tax-covered purchases are a declining share of income the richer you get; sales taxes are regressive. Not sure what's controversial about this.

[Bullhajj]

Sales tax-covered purchases are a declining share of income the richer you get.

What does this mean?

I think of sales tax as an expense everyone has to pay, if they purchase something. If you're rich, you're probably purchasing more, simply because you can. And if you're purchasing more, it seems reasonable to assume you're paying more sales tax.

[Qenan]

More total, sure. But less as a percentage of your income.

[Ben]

McCullough- Yeah, that's what you meant. But what you said was "Not like any kind of sales taxes are paid by the rich, really" which is nonsense.

Oh, and sales taxes aren't truly regressive. Regressive doesn't mean "bad for poor people."

[Jason McCullough]

Well excuse me, Mr. BenASpecificupagaus. :)

Sales taxes don't hurt the truly poor much, due to the various exemptions, but they seriously screw the lower middle class.

Tim, rich people use a lot more of their money on investment and various non-taxed spending items.

[Linoleum]

So if the poor are exempt from sales taxes, the lower middle-class still above the Spam line....

...I guess the rich are eating canned meat otherwise I don't know where those millions of dollars in tax revenue will come from!

This thread is being taken way too seriously.

[Jason McCullough]

If you read the decision, it covers all "non-perishable meat products," not spam.

[Bullhajj]

Tim, rich people use a lot more of their money on investment and various non-taxed spending items.

Ah, I get it now.

[shift6]

So an investment is a "spending item" now? Jesus.

[Jason McCullough]

It's a choice what to do with your money; I don't see any moral reason it should be taxed any differently.

[shift6]

Well there may or may not be a moral reason, but how about a pragmatic reason. Is a savings account at a bank an investment even though you may shitty earnings? Would you pay sales taxes on employee retirement plans like 401K/403Bs? Is buying chips to play craps an investment which is simply more risky? Is it an investment if you play single bonus video poker where optimal play over time guarantees a return greater than what you put in?

I mean pragmatically, what kind of "investments" ought to have sales taxes? And why should others be exempt?

[Jason McCullough]

We call them "income" or "capital gains" taxes when they're on investments; didn't mean we should come up with some new sales tax for investments.

[noun]

As a Washingtonian, I'm not as upset about the spam tax as I am about the plan to increase the gas tax by 15 cents a gallon over the next ten years. I just wish the state government would admit we need a state income tax already. I'm really sick of all these random nickel and dime taxes.