Fri
Apr 13 2012
09:44 am
Tax cuts!
By: R. Neal

The State House passed two tax cuts yesterday.

The first reduces sales tax on groceries from 5.5% to 5.25%, a whopping .25% reduction, or 25 cents on every $100 worth of groceries. The impact on state revenues will be about $21 million, according to the bill's fiscal note.

The second tax cut phases out the state's estate tax, which will result in a $95 million per year reduction in state revenues. The tax is estimated to affect fewer than 1,000 families.

So do the math. Let's say 1,000 families equals 5,000 people. That means less than 1/10th of a percent (0.08%) of the state population will get nearly $100 million (about $20,0000 each) in tax breaks, while the other 99.9% will get a $21 million break (about $3.50 each), 25 cents at a time.

Or to summarize, the 0.1% get a $20,000 tax break and everybody else gets a $3.50 tax break. How very Republican!

Topics:
bizgrrl's picture

That's what I'm talking

Submitted by bizgrrl on Fri, 2012/04/13 - 9:52am.

That's what I'm talking about.

CathyMcCaughan's picture

Math is a liberal conspiracy.

Submitted by CathyMcCaughan on Fri, 2012/04/13 - 10:05am.

Math is a liberal conspiracy.

rikki's picture

The real impact of that

Submitted by rikki on Fri, 2012/04/13 - 11:29am.

The real impact of that grocery tax cut will be that consumers will see none of it, and retailers will simply send less money to the state and pocket the difference. It's the classic steal-the-rounding-error heist.

rikki's picture

It's not a view of tax

Submitted by rikki on Fri, 2012/04/13 - 3:46pm.

It's not a view of tax collection. It's a view of aggregation. The change is so trivial as to be invisible to consumers. It will not give anyone more purchasing power nor alter price points.

Only retailers will see the difference, and they'll likely see it as an opportunity to put a little more vigor in the vigorish they add to prices when rounding off to the nearest number ending in 9. We won't know which items got more expensive or why, but Pilot and Kroger and other big retailers will surely find ways to move the quarter per $100 from our wallets to their profits.

This was not done to benefit consumers. It hurts the state. It only makes sense as an opportunity for big retailers and their shareholders.

rikki's picture

When I explicitly say "big

Submitted by rikki on Fri, 2012/04/13 - 5:10pm.

When I explicitly say "big retailers" and mention shareholders but get asked about a small retailer that is literally owned by its customers, there is really nowhere to go but cynicism.

rikki's picture

The sky is blue.

Submitted by rikki on Fri, 2012/04/13 - 6:18pm.

The sky is blue.

rikki's picture

You're just too smart for me.

Submitted by rikki on Fri, 2012/04/13 - 11:25pm.

You're just too smart for me. I have no choice but to admit you are right. Because TRM will not seize the opportunity to exploit its customer-owners, we can trust Pilot to be as ethical in its operations. Whatever is true of a community cooperative is true of large corporations. All hail our state's Republican leadership!

rikki's picture

Says the guy who is trying to

Submitted by rikki on Sat, 2012/04/14 - 11:15am.

Says the guy who is trying to put Three Rivers Market on the same level as Kroger and Pilot. To the extent that you are even interested in the thread topic, as opposed to just contradicting me, you are defending Republicans and big corporations. There might be a clue for you lurking in there.

rikki's picture

I'm mocking this "half

Submitted by rikki on Sat, 2012/04/14 - 3:41pm.

I'm mocking this "half measure," which is an incredibly generous description for shaving off a meager bit of the food tax in even tinier steps. A half measure would be a distinct improvement. I favor elimination of the sales tax too, and if you've somehow divined otherwise, it's just because you're so emotionally invested in finding something to disagree about. You've made it clear that you'll dispute what I say regardless of whether you actually disagree or have even bothered to comprehend.

rikki's picture

Actually, I did address that,

Submitted by rikki on Sun, 2012/04/15 - 11:38am.

Actually, I did address that, and doing so caused you to switch your argument from 'you don't understand how taxes are collected' to 'I'm going to pretend you are talking about Three Rivers Market.'

There is plenty of historical and observational evidence showing that Haslam will use his office to benefit Pilot Corp. Pilot probably does not even need to adjust their pricing strategy to take advantage of this opportunity. There's probably a whole body of consumer-behavior research showing a perceived increase in purchasing power, even if only by 0.25%, results in an even larger increase in purchases.

This "tax cut" is really just a retailer's gimmick adopted by the General Assembly.

rikki's picture

What is your position on this

Submitted by rikki on Sun, 2012/04/15 - 3:42pm.

What is your position on this issue? Why did the state government opt to reduce the tax on food by so little and to spread the change over several years?

Pam Strickland's picture

Rikki, have you lost your

Submitted by Pam Strickland on Sun, 2012/04/15 - 2:51pm.

Rikki, have you lost your mind?

rikki's picture

Posting something like that

Submitted by rikki on Sun, 2012/04/15 - 3:45pm.

Posting something like that without bothering to even say what it is that you find objectionable is pure rudeness.

Rachel's picture

Could you two (not you Pam)

Submitted by Rachel on Sun, 2012/04/15 - 3:56pm.

Could you two (not you Pam) take it outside? I keep clicking on new posts, thinking I'll see something interesting and all I see is you two bickering.

Min's picture

I've read this exchange twice.

Submitted by Min on Sun, 2012/04/15 - 4:13pm.

And I still can't figure out what it's about, other than two people talking past each other with increasing animosity.

BTW if you want an example of the Guv acting to benefit Pilot Oil, you need look no further than his decision last year to join other governors in opposing mandated improvements in fuel economy for cars.

Cha-ching!

Pam Strickland's picture

Context, Rikki, context.

Submitted by Pam Strickland on Sun, 2012/04/15 - 5:36pm.

Context, Rikki, context.

redmondkr's picture

Thanks Rikki for throwing

Submitted by redmondkr on Fri, 2012/04/13 - 11:34am.

Thanks Rikki for throwing cold water on all my plans to spend my new-found windfall.

Min's picture

Indeed.

Submitted by Min on Fri, 2012/04/13 - 11:53am.

Spend that quarter wisely, 99%.

Andy Axel's picture

the other 99.9% will get a

Submitted by Andy Axel on Fri, 2012/04/13 - 12:05pm.

the other 99.9% will get a $21 million break (about $3.50 each), 25 cents at a time.

Haslam: "Here's a quarter back! Go Vols!"

Min's picture

I have a question.

Submitted by Min on Fri, 2012/04/13 - 12:57pm.

Some of the legislators have said that the purpose of phasing out the estate tax is to keep wealthy retirees in Tennessee. Where, exactly, is the benefit to Tennessee in keeping retirees, even wealthy ones, in the state? They're retired, so they're not starting or running businesses, they don't have children who attend public schools, they don't contribute to the state pension, and they tend to use a singificant share of health and related services. Sure, they eventually die, but the tax cuts mean the state will not benefit.

I just don't get it.

R. Neal's picture

Actually there's some logic

Submitted by R. Neal on Fri, 2012/04/13 - 1:44pm.

Actually there's some logic to that. Attracting retirees that is. It's called the "mailbox economy," referring to retirement checks. Seniors don't use many services, as you note, but still spend money and pay taxes. As for the health and medical services, those are almost 100% paid for by federal dollars flowing in to the local economy.

Min's picture

Okay, that pisses me off.

Submitted by Min on Fri, 2012/04/13 - 2:13pm.

But it makes total sense.

R. Neal's picture

Don't commute to work every

Submitted by R. Neal on Fri, 2012/04/13 - 2:25pm.

Don't commute to work every day, don't have kids in schools, for example.

R. Neal's picture

Drive discretionary miles

Submitted by R. Neal on Fri, 2012/04/13 - 2:42pm.

Drive discretionary miles (like everyone) to spend discretionary funds they have in abundance. Health and social services they use create federally funded jobs. I'm guessing Florida will be happy to take any seniors who don't like it here.

CathyMcCaughan's picture

I know this is a touchy

Submitted by CathyMcCaughan on Fri, 2012/04/13 - 4:02pm.

I know this is a touchy subject at least partially because we are not spring chickens ourselves. Aging bible belt populations, for the most part, are more politically active. They are active in fighting AGAINST public education and FOR legislation based on their fear of the world, fear of people who don't look and think like they do, and lack of fear about the future of this planet.

CathyMcCaughan's picture

Why Older Citizens Are More

Submitted by CathyMcCaughan on Fri, 2012/04/13 - 4:22pm.

Why Older Citizens Are More Likely to Vote
This one is too funny not to read.

R. Neal's picture

P.S. tax rates or tax

Submitted by R. Neal on Fri, 2012/04/13 - 2:53pm.

P.S. tax rates or tax collections, because seniors tend to buy or build more expensive properties?

redmondkr's picture

I read recently that the

Submitted by redmondkr on Fri, 2012/04/13 - 5:20pm.

I read recently that the average age of Fox News viewers is 65.

Every time I go to my cardiac rehab sessions, I have to sneak around and change the channel on the old ducks' two TVs to any other channel. I do it more often since Joanne left. She always insisted on channel 8 so she could watch her soaps from the treadmill.

fischbobber's picture

The quarter

Submitted by fischbobber on Sat, 2012/04/14 - 12:24am.

It costs a quarter to use the grocery cart at ALDI's. Perhaps this is what our governor had in mind. We can save money by buying four dollar a gallon gas at Pilot, driving an extra 20 miles to ALDI's using our quarter to rent a shopping cart and save two dollars and eighty seven cents for a net loss of four dollars and twenty- two cents. God bless our governor and the free market. Now we know for sure that sending our children to Young Life teaches them to do the right thing!

lovable liberal's picture

The question

Submitted by lovable liberal on Sat, 2012/04/14 - 11:32pm.

For members of the 99 who still support Teapublicans, the question is: How cheaply can your support be bought?

'Cause this is waaay lower than a mess of pottage.

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