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Tis the Season for Tax Sticker Shock Abuse

Tuesday December 6th, 2016   •   Posted by K. Lloyd Billingsley at 10:10am PST   •  

christmastaxProperty tax bills showed up back in October in envelopes reading: TAX BILL – OPEN IMMEDIATELY. Note the light touch, sort of like “hand over the wallet, Jack!” This year, many taxpayers will have to dig deeper in their wallet, but not because California’s county governments are providing them more and better services. The property tax bill is not tied to government performance of any kind. Counties such as Sacramento have determined that the property is now worth more, so they jack up the bill as much as possible under voter-approved Proposition 13. Even so, the bill is not negotiable and taxpayers can’t seek a better deal at Fred and Donna’s government down the street.

Taxpayers don’t have to pay the property tax bill immediately. They can pay the first installment by December 10, thoughtfully timed for the holiday season, when families are hard pressed for cash. If taxpayers miss the deadline, the government slaps them with penalties. The second installment is due next April, right around the deadline for income tax returns. On the other hand, tax abuse is always in season.

The government withholds money from workers’ paychecks, which means that the government gets the workers’ money before they do. This money grab dates from World War II, and it was supposed to be temporary. Good luck with that. As Milton Friedman said, nothing is so permanent as a temporary government program.

With all the talk of draining the swamp, no politician aims to eliminate withholding. Some talk of tax reduction, but workers should be on guard for politicians’ rhetorical tricks. If workers somehow get to keep more of what they earn, the government does not thereby “give” them anything. Taxpayers might keep that in mind as they write those checks before the December 10 property tax deadline, lest they suffer a penalty. And remember, you are not getting more and better government service. You are only giving the government more of your money. Happy holidays, everybody!

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December 2016