THE NEW TAX THAT MAY HAVE SNUCK UP ON YOU

A considerable amount of media attention was focused on the increase of the state tobacco tax on Tuesday. A pack of cigarettes will now carry a $2.52 state tax, after the 75 cent increase took effect September 1st. Of course, since this tax is imposed on nasty smokers, it can be wrapped up in the cloak of "public health" and "low-income health care funding". The one you may have NOT noticed is the "Police & Fire Protection Fund", which also took effect on Tuesday.

First, a little history may help you understand the mechanics of this new tax. Six years ago, the State Legislature passed a "temporary" cell phone tax to upgrade 911 service around Wisconsin. I put temporary in quotation marks because whenever you see that, grab your wallet and run for the hills. I don't think anyone, though, would argue that an upgrade of the 911 service, which would allow for better response times and better tracking of where the calls come from, was a bad thing. But, remember, this was a "temporary" tax.

When state officials announced the upgrade was finished, they also discovered they had collected $20 million in taxes above and beyond their costs. The plan was to send this surplus back to the cell phone users as a credit on their bills. $20 million spread over that many people is not much, but there was the argument the tax was "temporary" and the additional revenue was not needed.

As you can imagine, you did not see any credit on your cell phone bills. The surplus was sucked into the most recent budget to cover the shortfalls and deficits, as the Wisconsin tradition of raiding funds continued unabated. 99 percent of the people would not even notice, right? Well, I hope that 99 percent of the people notice that the new budget not only extended and raised the the cell phone tax by 75 cents. It applied it to all landlines as well.

Now, of course, if the money is for police and fire protection, I think the support will likely be there from the public. BUT the projected $107 million in taxes is not going for any new police and fire programs or personnel. It is being used to offset the reduction in state aid to cities and counties that was also passed in the state budget.

I love the idea of the Maciver Institute. Rather than call the tax the "Police and Fire Protection Fund", which you will see on this month's bill, how about a little truth in taxation:
* "The New Tax We Slipped in to Take More of What You Have and We Hope You Don't Notice," or
* "Hey, in a Budget that Spends Billions More than the State Taxpayers Can Afford We Had to Get Creative as to How to Milk You for More Money Fee."

And to keep this in perspective, I am reprinting the list of new fees and service charges (remember the Governor said we did not pass the budget with significan "tax" increases), compiled by State Representative Mike Huebsch:

* New Income Tax Bracket (Individuals earning $150,000 and couples earning $300,000 or more)
* Capital Gains Tax Increase
* Delay Deduction for Health Insurance Premiums
* Delay Deduction for Child Care Expenses
* Eliminate Tax Deduction for Domestic Production
* Increase Corporate Income Tax (Throwback Sales)
* Increase Cigarette Tax
* Increase Tobacco Products Tax
* Increase Hospital Tax
* Apply the Hospital Tax to Ambulatory Surgery Centers
* Increase Nursing Home Bed Tax
* Delay Tax Credit for Conversion to Electronic Medical Records
* Delay Tax Credit for Community Rehabilitation Program
* Delay Biodiesel Fuel Production Tax Credit
* Reduce Film Tax Credit
* Increase Sales Tax on Businesses (Sales Tax Treatment of Disregarded Entities)
* Delay Sales Tax Exemption for Alternative Energy Resources
* Reduce Farmland Tax Credit
* Create deceptively titled ‘Police and Fire Protection Fee’ assessed on all phone lines
* Increase Low-Income Assistance Fee (assessed on all utility bills.)
* Increase Work Permit Fee for Teenagers
* Increase Child Care Licensing Fees
* Increase Birth, Death and Marriage Certificate Fees
* Increase Boat Registration Fee
* Increase Handgun Record Check Fee
* Increase Securities Trading Fees
* Increase Increased Assisted Living Facilities Licensing Fees
* Increase Insurance Agent Appointment Fees
* Increase Bobcat Hunting Permit Fee
* Increase Elk Hunting Permit Fee (Wisconsin does not have an elk hunting season.)
* Increase Solid Waste Tipping (Garbage) Fee