Wednesday, October 05, 2005

$3 million, $5 million, $100 million...

In the past few days, we've seen the Streamlined Sales and Use Tax Project implemented with the hope of collecting $3 million in the first year and watched as the guys in charge move to refinance tobacco bonds with their eyes on an additional $100 million. Do these guys do anything other than figure out where to get it and how to spend it?

The Streamlined Sales and Use Tax Project is essentially a voluntary state level initiative to figure out how states can structure their tax collection laws to make sure they don’t miss the sales and use taxes associated with on-line/remote purchases. So if you have a thing for Nordstrom, forget about the sales tax advantage of window shopping KC or Chicago and then coming home to buy on-line. As reported by Radio Iowa (notice no politicians are quoted in the interview, hmm):

Iowa is one of 19 states that're taking part in a voluntary program to streamline the paperwork for sales and use taxes they collect. Don Cooper of the Iowa Department of Revenue says the agreement between the states has several goals. He says it's designed to simplify their sales tax laws and make them more uniform, and make the tax administration forms more uniform. He says it would allow retailers that sell across state lines that haven't collected the taxes to start collecting them. …

... Cooper says the agreement also includes an amnesty program to encourage businesses to take part. He says if there are retailers that have had enough business that would require them to register with a state, but they haven't registered, the agreement would let them register without having to pay the back taxes they owe.

Cooper says the agreement should help the coffers of the states involved. He says they've made projections that in the first year Iowa would collect one to three million and three to five million in the next year. Cooper says they hope to add states as the program moves ahead.

On the deal to refinance the tobacco settlement bonds – these are bonds from the 2001 sale of future payments of Iowa’s tobacco settlement monies – it’s estimated Iowa will pull down $100 million, and the Governor, with his Senate pal Gronstal, are already spending that money. From the DMR:

... Vilsack said Tuesday he wants legislators to spend the money on water quality projects, economic development and capital improvements.

"This is a way to squeeze more money out of the tobacco settlement and spend significantly more on water quality" and other projects, Vilsack told The Des Moines Register. ...

... The governor wants the Legislature in the 2006 session to appropriate the new money to three areas:

• Water quality programs would get a third of the money.

• Biotechnology, manufacturing projects and other economic development initiatives through the Iowa Board of Regents would get a third of the money.

• The rest would go to unspecified capital improvements. ...

... "It's obviously a home run when we find additional resources through sound business practices to identify a very significant amount of money. That's a win-win for everybody," Gronstal said. ...

The GOP types aren’t saying much, which suggests they might have their own list of politically popular goodies – you know, like roads to nowhere.

You just have to wonder when these profligate habits are going to trip up some of these guys’ political ambitions – but that’s why we have guys like Grover on the loose.


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