Taxable Talk

There are many ways to catch tax scofflaws. California is trying something new—publicizing the worst offenders. Will shame cause payments?

The Board of Equalization collects sales and use tax in California. Under a law passed last year, both the BOE & the Franchise Tax Board must post lists of the worst offenders. The BOE has come out with their list of 227 who owe $219 million to California. A company can get off the list by paying the amount in full or by agreeing to a payment plan. Debts being appealed or in bankruptcy will not be listed.

The list will eventually grow to 250 names. For now, you need to owe $201,000 to make the list. Topping the list is Southland Federal Enterprises at $17,152,957.96 (we wouldn't want to forget those 96 cents); their debt dates back to 2000. Next on the list are Khaled Mohammed Tabbah of Walnut and Ammar Assad Tabbaa of Orange; each owes $16,887,211.88. In fourth place is the former owner of the Los Angeles Kings, Bruce McNall (also a former resident of ClubFed); he owes a measly $7,138,011.08 dating back from 1994.

Later this year the FTB will issue its list. As noted in the press release announcing the list, the BOE has received one payment of $300,000 and two payment plans totaling $1.5 million. So it appears that shame works.

California's legislature has plenty of warped ideas. Now there's a piece of legislation that would tax big vehicles to subsidize small vehicles. Under the "Clean Car Discount" bill, big vehicles that emit lots of Carbon Dioxide would pay a tax of up to $2500. This tax (after appropriate amounts are siphoned off by the state bureaucracy) would subsidize small cars through a rebate program.

Forgetting that global warming is a theory—a theory that is looking more dubious (to me) day by day—I doubt this will have any impact on global warming. In fact, the only thing this will do for certain is raise agriculture prices as farmers are big users of big vehicles (they need them), and they'll pass on their costs, of course.

Just another typical day in Sacramento....

One of the blogs that I read is the FlashReport, a blog on California's politics. They've alerted me to some of the tax proposals being circulated in the Legislature. Not surprisingly, all are being sponsored by Democrats.

Global Warming/Greenhouse Gases Car Tax (AB 493) Sponsored by Ira Ruskin (D-Redwood City), this would impose a tax on new car sales of as much as $2,500 for cars that emit "large" amounts of greenhouse gases.

Property Tax Increase (SB 34) Tom Torlakson (D-Antioch) is sponsoring legislation that would allow unelected "governing boards" to increase property taxes.

Changing the Tax Rules (ACA 8) This constitutional amendment is sponsored by Jared Huffman (D-San Rafael) would change the voting requirements for new taxes from 2/3 (66.67%) to 55%.

These were the worst of the bunch, but there are more listed...a lot more. You can read about the rest at the FlashReport.