Saturday, October 13, 2007

Stick a Fork in Glenn's Tax

Over the vehement opposition of almost everyone except a few colleagues to whom he can toss plumb committee assignments-or not, Speaker Richardson continues to push his not-so-great tax on everything-a plan that's changing faster than Richardson's moods. But, his latest desperate addition is the death knell for this hair-brained proposal. Stick a fork in it. It's all over but the shouting.

On Thursday, Georgia State released a report on the plan that showing what Alan Essig with the Georgia Budget and Policy Institute told us in January: the plan simply won't produce enough revenue. It's way short-like billions short, unless Richardson includes sales tax on business-to-business services, which he now, predictably says he will do.

The problem is, the experts, like the folks at Georgia State or Georgia Budget and Policy, never even considered that Richardson would propose taxing business-to-business transactions because doing so makes zero economic sense. Essig said that taxing business-to-business transactions would hurt the state's economy and that taxes should be charged only when a product is sold to a consumer. This new wrinkle will add cost at every step of the production process-cost that will ultimately be passed on to consumers (read: "you and me").

So, not only will we be paying increased sales tax, including a brand spankin' new tax on services, the goods we purchase will cost more because of increased cost to business to produce the products. In short, the cost of everything goes up, even before the new sales tax is applied.

Don't spend too much time thinking about it. I'm sure that Richardson will continue his dog and pony show, but the Glenntax is D.O.A.

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