So Don’t Hold Your Breath on That Tax Refund
At least if you live in Rhode Island, that is. But perhaps a harbinger of things to come for those of us in the west – like California maybe?
Seems thousands of Rhode Island income tax refunds are being held up because the state just doesn’t have the dough. We hear that some 53,000 individuals are still waiting for their $36 million or so in refunds. According to the Providence Journal, when the matter first came up last month, state officials said they were going to delay payment of the refunds by about three weeks. But the lag has grown to more like four to six weeks already.
Hand it to the state legislature, however, where a bill has recently been introduced which would force the state to pay interest sooner than typically required on delayed refunds.
Of course, one solution to this pesky problem of having to refund cash to taxpayers is to simply raise the taxes–wipe out those refunds altogether, right? That seems to be the mindset in California, anyway. First Arnold comes out with a proposition that spending be further slashed as a budget balancing measure. But such a notion just doesn’t seem to fit too well with the legislature’s left-leaning agenda. So last week came their ideas: taxing oil companies (more), delaying scheduled tax breaks for business and – get this – imposing a modest $5 billion (with a “B”) tax increase.
“We have to stop thinking we can afford to provide the amount of services that the state’s residents expect for less money,” quoth Senator Gil Cedillo (D-L.A.). “That’s just not going to happen.”
“Asking people to dig deeper to support a chronically broken bureaucracy that is faced with a $19 billion budget deficit is just plain wrong,” noted Senate Budget Committee Vice Chairman Bob Dutton (R-Rancho Cucamonga).
Among other things, the Democrats would impose a 60% increase in alcohol taxes ($210 million) 30% increase in vehicle license fees, cut $220 off of the dependent care tax credit ($430 million) and, of course, extend for a year the 0.25% surcharge on individuals ($1 billion).
Which leads us, of course, to even more immortal words from that noted political economist and tax-savvy Secretary of State, Hillary Rodham Clinton who observed, last week, that “The rich are not paying their fair share in any nation that is facing the kind of employment issues [America currently does]–whether it’s individual, corporate or whatever [form of] taxation” quoth Ms. Hillary in a speech before the Brookings Institution.
“Brazil has the highest tax-to-GDP rate in the Western Hemisphere and guess what–they’re growing like crazy. And the rich are getting richer, but they’re pulling people out of poverty.”
Just makes you want to pull up stakes and move to Brazil, doesn’t it?
CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters. You should consult your CPA regarding the implications to your own particular situation.
Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He is also a contributor to the recently published 13th edition of Tax Savvy for Small Business, published by Nolo. He can be reached at 831-7288, and welcomes comments below.