Beating The Proverbial Dead Horse.
Tonight, as I was driving home, I listened to a New Jersey – based radio talk-station. (The non-Garden Staters should know that most of our radio and TV is New York City or Philadelphia-based). Anyway, the subject was, not surprisingly, the state government shutdown.
I heard at least three people call the host and say of the Governor’s desire to raise the sales tax from 6% to 7%, in words or substance, “It’s only one percent. What’s the big deal? What’s the fuss? It’s only a penny.”
I’ve tried to make this clear at least twice before, but I’m going to try again. Pay attention.
A one percent increase would raise the sales tax from 6% to 6.01% 6.06%**, not 7%.
Let me say it again, only LOUDER this time.
A ONE PERCENT INCREASE WOULD RAISE THE SALES TAX FROM 6% TO 6.01% 6.06%**, not 7%.
Raising the sales tax from 6% to 7% constitutes an increase in the sales tax of not 1%, but 16%.
Let’s try it this way.
If you were earning $6.00 per hour, and your pay was raised to $7.00 per hour, would you say you got a 1% raise? A one percent raise would mean your new pay would be $6.06. Or, would you figure that your pay was raised by 16%?
If you want to agree with the Governor’s position, fine, but at least know what the hell you are agreeing to.
Don’t make me explain this again.
Sheesh.
**Math correction courtesy of Blanton’s and Ashton’s – Article II. Section 4. PRS regrets the error, but disagrees with the author’s downplaying of the democrats’ effort to play hide the football with taxpayers.
You’re using the old way of figuring things. As New Jersey’s Treasury, Bradley Abelow, explained “New Jersey’s budget, however, defies this basic principle of math.†– http://www.state.nj.us/treasury/omb/publications/06bib/pdf/bib.pdf
Comment by Enlighten-NewJersey — July 5, 2006 @ 9:02 pm
Good grief. I am embarassed to admit I am one of the idiots. Thanks for the education. I am not from NJ but IL and it is just as bad.
Comment by Kim — July 5, 2006 @ 9:32 pm
What are they doing with all of those extra high ass taxes you are aleady paying?
Comment by Catfish — July 5, 2006 @ 10:15 pm
My guess is that it ain’t goin’ into their educational budget…
Comment by That 1 Guy — July 5, 2006 @ 10:41 pm
You see the problem Jim – it’s math and most people don’t want to even think about it. So let’s really make their heads explode. Say you buy a $100 cell phone and you pay 6% tax on it. That means you pay $6.00 in tax just to have the $100 phone. Now if you buy that same phone and pay 7% tax, you will pay $7.00 in tax. That’s $1.00 more than you currently spend.
Divide $1.00 by $6.00 and you get .16666666 in other words that one dollar is 17% of the original $6.00.
Now let’s take this to the logical conclusion. If, over the course of a year, you spend $15,000 for products that are taxed – you will pay $900 in sales taxes alone for that year – just on sales taxed items – that doesn’t include all the other taxes you also pay to the state. If you spend that same $15,000 at 7% you will pay $1050 in taxes or $150 more than you currently pay. What can you do with $150? I can think of a few things it would be useful to have.
Do you know how much you spend on goods and services that are taxed in the course of a year? Chances are you spend at least 1/3 to 1/2 of your annual income on taxable items. What could YOU do with that money? Even if it was $20 more per year, that’s $20 you don’t have and the government does have. And it’s not as if they bring in just a pittance each year to run all those “programs”… you have income tax, gas tax, cigarette tax (if you smoke), property tax, local town tax, maybe county tax, and even special taxes on certain items like some cars… Do they REALLY need more? What are they doing with the money coming in? No one knows they just keep saying it’s not enough. (got news – it will NEVER be enough!)
It’s all a big scam – all across the country. Everyone “wants” something but we get little or nothing in return. Makes me want to scream.
Comment by Teresa — July 5, 2006 @ 10:41 pm
Dude, I see what you’re saying, and it’s amusing, but when someone says “1% increase in sales tax” everyone knows that the sales tax is expressed as a percent and that means add another integer 1 to the current sales tax number. Not sure it’s worth being pedantic about in that manner.
Now if you were railing against people who eagerly await and spend their “tax return” each year, that would be worth the pedantry. Me, I’ll take a tax refund instead any day.
Comment by Jay — July 5, 2006 @ 10:56 pm
In fiscal year 2006, New Jersey took in $6.716 billion in sales taxes. Next year, including the various Corzine sales tax increases, revenue will increase to $8.377. That’s a 24.73% increase in sales tax revenue. Without extending the tax to new stuff or increasing the rate, sales tax revenue would have increased by 3.4%. In reality, Corzine’s plan is to increase the sales tax next year by 21.33%.
That’s why the Governor, tax increase cheerleaders and the media prefer to talk about the sales tax increase in terms of pennies. As in, “Governor Corzine wants to increase the sales tax by “a penny.â€
The collective family that is New Jersey is being asked to cough up an additional 110 billion pennies this year though an increase in the sales tax rate from 6 to 7 percent. Corzine also wants to extend the sales tax to goods and services not currently taxed to bring in additional 30 billion pennies and he expects us to buy more stuff so the state can take in another 26.1 billion pennies. All in all, the Governor is hoping the sales tax will bring in 166 billion 100 million more pennies to the state’s coffers.
Comment by Enlighten-NewJersey — July 6, 2006 @ 1:10 am
A curious thing about the words “pedantic” and “pedantry” is that it is difficult to use them without sounding, … well, pedantic. 🙂
Comment by Jim — July 6, 2006 @ 4:38 am
Just drive to delaware and buy the stuff without a sales tax, or buy in NY and PA when they have sales tax holidays
Comment by hoosierboy — July 6, 2006 @ 8:28 am
I understand and agree about the sales tax. But the tax that the legislature is wanting, or at least from what the MSM says that the legislature wants, is a tax on business and real estate. The consumer will wind up paying the tax regardless..it is just that the dim-a-crits can blame business for the higher prices brought on by higher taxes. With a sales tax the public will blame the legislature. But the irony is increasing a budget with no means to pay for the increase..typical political thought..
Comment by GUYK — July 6, 2006 @ 8:44 am
UNDENIABLE FACTS
1) The State of NJ is broke.
2) The State still plans to “hand-out” 1.5 billion dollars in “property tax rebates” to residents in the fall. This absurdly includes $500+ checks paid to renters who obviously pay no property taxes. Call it what it is : Wealth redistribution to Democratic urban voters.
If they didn’t pay into the pot, just how do you call it a rebate ???
Property owners pay for the entire bill for education. Non-property owners pay nothing. On top of that, the Democrats plan to give them $500+ for their votes in November. Cancel the rebates, and there is no need to raise the sales tax. Simple
Comment by cousin gary — July 6, 2006 @ 10:34 am
One Percent of What, Exactly?…
Jim, over at Parkway Rest Stop, is getting all caught up in the math….
Trackback by Blanton's and Ashton's - Article. II. Section. 4. — July 6, 2006 @ 10:35 am
Forget the math, I can’t believe the state is still shut down after five farookin days. I read yesterday they shut down the casinos in Atlantic City.!!!! I’m legendary for the mathematical ineptitude but even I can figure out without revenue, it hardly matters what the tax rate is — no one will have any money to pay anyway. Can’t these idiots figure out some kind of stopgap compromise to keep things open? If it wasn’t so pathetic, it would be hilarious.
Comment by Libby — July 6, 2006 @ 1:22 pm
Having Your Cake and They’re Eating It Too…
This is the long awaited deal between New Jersey Democrat Gov. Jon Corzine and the Assembly Democrats. Not only does the Governor get his sales and use tax hike, but the Assembly gets a bunch of their tax hikes too. And this is what we were waiting f…..
Trackback by A Blog For All — July 6, 2006 @ 9:13 pm
[…] Via Jim at Parkway Rest Stop, an exercise in basic arithmetic. Jim is a New Jersey resident; that state has been in the news lately, because of budgetary woes that led to a shutdown of the state government over the last several days. […]
Pingback by Cipherin’ 101 at ten billion butterfly sneezes — July 6, 2006 @ 9:38 pm