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Creative Budget Balancing

Written by Nickel - 6 Comments

States across the country are hurting. High unemployment numbers and reduced corporate profits have gutted tax revenue. At the same time, every state besides Vermont has a law requiring a balanced budget. As such, state governments are getting desperate to make ends meet.

A recent article in Forbes highlighted the lengths to which some states are going. They’ve been slashing budgets to the bone, but you can only cut so deep without compromising basic services. Thus, they’ve gotten creative when it comes to generating revenue.

Here are some of my favorites:

  • California has proposed changing the date on state paychecks from June 30th to July 1st to “save” $1.2B (on paper) during the current fiscal year. It’s unclear what would happen next next fiscal year, when that $1.2B hits the balance sheets.
  • Georgia lawmakers have proposed a “pole tax” — a $5 fee levied on strip club patrons. It didn’t pass.
  • New York has proposed to put ads on garbage trucks and to institute an 18% tax on “sugary” drinks. The governor has approved a 46% increased in tobacco taxes and a 58% increase in wine taxes.
  • An Oregon lawmaker proposed a $98 per ounce tax on medical marijuana, and even pushed to have the state do the growing. These measures never made it out of committee.
  • A Michigan Senator introduced a bill to levy a $250 fee on strippers. The state might also agree to house California prisoners to make extra money, though it’s unclear to me how California would be able to pay.
  • Nevada increased hotel taxes from 9% to 12%, and a Senator from Las Vegas has proposed a $5 tax on prostitute tricks. The latter measure didn’t pass. Even if it had, I’d think it would pretty tough to enforce.

Now… Just imagine what this list would look like if the Federal government wasn’t allowed to run a deficit!

Source: Forbes.com

Published on July 24th, 2009 - 6 Comments
Filed under: Economy, Taxes

About the author: is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

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6 Responses to “Creative Budget Balancing”

  1. 1
    Jeremy Olexa Says:

    “California has proposed changing the date on state paychecks from June 30th to July 1st to “save” $1.2B (on paper) during the current fiscal year. It’s unclear what would happen next next fiscal year, when that $1.2B hits the balance sheets. ”

    A more logical solution would be to *require* direct deposit. Meh, I know logic doesn’t come into play with gov’t =P

  2. 2
    Daniel Says:

    Now… Just imagine what this list would look like if the Federal government wasn’t allowed to run a deficit!

    Indeed. Now imagine how much better things would be if the Federal government lived within its Constitutional charter.

  3. 3
    kitty Says:

    I like the ads on garbage tracks idea. The government can follow and put ads on USPS tracks. Honest business income that doesn’t require new taxes or cuts.

    Other ideas:
    - legalize prostitution, charge license fees and taxes. Savings on enforcement as well as extra income.

    - beg for money; organize “help California” campaign.

    I wonder how long it’ll take before California decides to legalize marijuana… I heard some people were selling California IOU at a discount on craigslist and ebay.

    About Federal Government. Unlike states they have a huge advantage – access to the printing press.

  4. 4
    DDFD at DivorcedDadFrugalDad Says:

    I would believe anything these days . . .

    There has also been much written about towns increasing tickets written to raise revenues . . .

    If these jokers got as creative about cutting spending . . . we would be set!

  5. 5
    RB @ RichBy30RetireBy40 Says:

    At least California is paying 3.85% interest on their IOU! :)

    Rgds,

    RB

    Rich By 30 Retire By 40

  6. 6
    Txgal Says:

    Nevada has legalized prostitution, so taxing tricks is no more (or less) difficult to enforce than any other sales tax.

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