I have been reading lately of the difficulties cities, counties and other taxing jurisdictions are having because of the recession. With retail sales way down, sales tax revenue is also way down. Governmental entities are like the State of
In an effort to squeeze all the tax revenues from slow paying businesses, some jurisdictions are going to extreme measures to collect.
By this morning, less than 24 hours after the tax seizure, an embarrassed Spansion had paid over $8 of the $9 million it owed the county.
I certainly understand the county’s need for the tax revenue, as approximately $5 million was going to be paid to a small school district where Spansion is located. For that school district, $5 million represents a sizable percentage of its annual budget, but I wonder if the greater good of the city, county and school district couldn’t have been better met if someone for the tax collector had simply picked up the phone and called Spansion to say, “Hey, did you guys realize that your taxes were 10 days late?”
I think this example is a foreshadowing of things to come in many tax jurisdictions across the country. Sadly, while I realize extreme times require extreme measures, I really hate to see such extreme pressure placed on the businesses that generate the tax revenues to start with.
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