Thursday, August 19, 2010

The Pros of Proposition 101

They also originally proposed to track how many miles are driven, and tax drivers for every mile! They also imposed on car rentals a new "fee" (tax) without voter approval, while providing no direct benefit to car rental customers. Proposition 101 will reject these crazy and lawless ideas.
The only effect of Proposition 101 on school district revenue is on the vehicle ownership tax, reduced in four yearly steps. State aid is already required by law to replace 100% of that revenue effect. Schools will not face ANY revenue loss.

Colorado taxes are regressive; they cost proportionately more to low-income people. Proposition 101 reduces that unfairness by lowering taxes on basic needs--vehicles and phones. That relief benefits most those who have the least.

Even the liberal Denver Post opposed on July 12, 2010 a proposed Denver tax increase. Their editorial ended: "the council needs to remember we already have a government we can't afford." Wow! Amen!

It is economic insanity to raise taxes (also fees) in this depression. If raising them is bad, it's likewise true that lowering them is good for the economy. That's what Proposition 101 proposes to do.

There are many problems with the tax system. You know what they are. Proposition 101 limits state and local government charges in just three areas--the ones that are most unfair. They are VEHICLE, INCOME, and TELECOMMUNICATION TAXES.

Think the problem is exaggerated? Consider this example. The average home property tax rate is 0.56%. (Multiply the 69.761 statewide average mill levy by 7.96%, the percentage of home value subject to tax.)

By comparison, what is the total new car tax? If an urban sales tax total is 8%, add 2.1% ownership tax, which may apply to a price above the actual sales price. Add inflated registration and other fees, way more than the $10 proposed here. You are taxed on manufacturer rebates that lower the net sales price but not the sales tax. Total charges on your net car price may exceed 11.2%, TWENTY TIMES the 0.56% average home rate. You still pay high ownership taxes and registration fees each year. Car buyers are getting taken for a ride!