Video about the Laffer CurveI want you to go see the recorded vote. When this bill blows up in the State's face then I hope that the people who voted for this monstrosity will be held accountable. North Carolina Appropriations Act of 2009. Senate Roll Call. House Roll Call.
According the the News and Observer -- The budget includes temporary taxes worth $990 million. About 80 percent of that comes from increasing the sales tax rate by one penny, so that most consumers would pay 7.75 cents on each dollar they spend through mid-2011. Corporate profits would face a 3 percent surtax for two years. Cigarette taxes will rise permanently by 10 cents per pack.
Hound Opinion: With the additional 1-cent added to the sales tax rate, we are moving towards the highest rates in the nation. Currently only 10 states have a combined sales tax rate of over 8% and ours will now be 7.75 cents in most communities. Three of those States don't have a State Income tax. Personally, I could care less about the Cigarette tax, which will rise permanently by 10-cents per pack to 45-cents, because I don't smoke; but it is a regressive tax that hurts our poorest citizens and if it does lead to fewer smokers or packs smoked, then it is not going to increase revenues.
The state is also going to increase income taxes exhorbinantly on people making over $60,000 a year and couples making over $100,000. So if an individual is making $100,000 a year, then that means they are going to be paying an additional $800 in taxes on top of what they are already paying; plus whatever taxes Washington decides they want, and this is just income tax. That is money being taken out of the private sector and being redirected towards the wasteful whims and fantasies of Elected Officials, who have proven they don't know how to maintain finances to start with. That is how we got into the hole we are now in. Maybe if people like Mike Easley and his wife weren't living it up on the taxpayer dime, then none of this would have ever been contemplated.
Corporate profits will face a 3 percent surtax for two years. So, we have a State unemployment rate of 11.2% and 15.5% here in Catawba County. I don't think business has laid people off for the heck of it. Statistics show that 98.1% of people employed in North Carolina are employed by small businesses. And here is our state taking 3% away from these company's bottom line over the next two years. How many of these businesses are going to be pushed over the edge into bankruptcy.
Many of you know that I am a Chef. I understand small business. My aunt owns 1859 Cafe here in Hickory. I laugh when I hear people, on the outside looking in, who think that her business is a money machine. She pays sales tax quarterly and the State isn't going to wait around for you to pay it. She pays a liquor license fee and an additional tax on each bottle she purchases from the ABC. She pays for a beer and wine license, as well as a license to use alcohol at catering events. Did you know that each restaurant pays to be inspected by both the health department and fire department? She pays city and county property taxes and an occupancy fee. She also matches FICA on each employee's wages that work for her. And if she turns a profit, then she has to pay Capital Gains tax and tax on her personal income. And here is our wonderful State, who seem to think money grows on trees, and think an extra 3% is just laying around that won't be missed. Hey guess what State of North Carolina, people are already having to cut back on eating out. That means less revenue and less chance to profit (Doh!!!). They don't have a clue.
A couple more jewels that McClatchy News Service reported. The first will assess sales tax on most digital downloads, including music, videos and ringtones, starting Jan. 1. That means a 99-cent iTunes download, for example, will instead cost $1.07. The second Internet-related tax is more complicated. Basically, it will allow the state to begin charging sales tax Sept. 1 on purchases from online merchants who make sales through referrals from N.C. Web site owners. Amazon.com has such a program, but discontinued it in North Carolina in June to avoid having to assess sales tax.
The Hound sees the ramifications of what is being done. Everyone wants to blindly maintain the status quo. No one wants to admit they have made mistakes and/or admit to past errors in judgment. The damage that has already been done will continue to snowball, because everyone involved is unwilling to go back to square one and totally rebuild our State's revenue structure.
We have to address issues that have harmed business. We have to help retain businesses that are on the brink of catastrophe and help entrepreneurs foster start-ups. These bills do none of that. These bills will keep these processes from being implemented.
In your gut, do you really think we aren't taxed enough? In my opinion, if you aren't willing to pay more money into the system yourself, then you have no right to demand more from others. That is where the Statists always get you. They create hostility and resentment towards others and all they do is take and take and take some more -- from everyone.
The effects of our government's actions are changing people's behavior. I believe that we are heading to the point where people are going to start usurping the injustices of The State Code and Tax System whenever possible. You are going to see Black Markets arise, Cash under the Table Deals, and Bartering become the norm. People will find a way around all of those Internet junk taxes. They are going to bring in very little revenue. Check out the story from the Seattle Post Intelligencer about Federal Tax Reveues Plummeting (The Most since 1932).
Employers that were just hit by an increase in the minimum wage are now being asked to pony up an additional 3% surtax on profit, and soon it will be the Federal Governments turn to increase income taxes and make demands on Employer based Health Care, as well as other hallucinations of grandeur. Riddle me this. If you are a business owner, why would you hire anyone at this time?
Government, at all levels, has created all of the elements needed to crash our economy and most people don't recognize or are in denial that the noose has been slipped around our necks. The only way out of this is Independence and self-sufficiency. That can't be achieved while supporting all of this dead weight. We have to create the elements that will lead to increased economic activity. That is the only way we are going to get people back to work. And without reasonably low unemployment, we cannot ever have a sustainable recovery and economic growth. Think about it. What has the State of North Carolina done that will achieve that goal?
