Taxes That Punish

I attended a meeting a few months ago that discussed taxes and Tacoma. One of the main focuses was on Tacoma's B&O tax. Many Washington cities have done away with this tax. In Tacoma (as I recall), businesses are taxed on gross revenues. It doesn't matter how much of that revenue is spent to run the business, the tax applies to all income. It's almost a punishment for doing well.

That's a huge burden if your business is barely squeaking by. It's unfair even if you're doing well. According to some of the speakers, Tacoma has found it increasingly difficult to site new business with this burden, especially when there are other communities in the same area who don't have this tax.

Here's an interesting thought. Ruston has a B&O tax as well. I don't think we charge the tax on gross revenues, thankfully. Talk about a way to drive business away! I believe the B&O income for Ruston is fairly small, too. What if we abolished this tax completely in Ruston? We don't lose very much income - and could gain several new robust, growing businesses who want all the amenities of doing business surrounded by a big city, but don't want to deal with one of the worst taxes in the state.

The council is rightly concerned with building a sustainable tax base for our future, an issue that needs immediate attention over the next 4 or 5 years until the town is fully developed. This is a small step that could bring a fairly quick return. Even if we don't see a huge influx of new businesses, it's a good move for our current businesses. Very small tax loss that actually encourages success (which means more tax income in other forms). It's a lesson that has been learned by many other communities in the state - and something that Ruston should explore. It would take less effort than has already been spent on the current attempt to increase our gambling tax 666% and reap much stronger benefits.

Just my thoughts for today. What are yours?
Karen