Call me crazy, but didn’t tax dollars used to pay for services like Fire Departments removing the proverbial cat from the tree or an annoyed state trooper showing up two hours after a minor fender bender?

According to the NY Times, these basic services have gone from just paying taxes to paying taxes plus an “accident response fee.”

Not to steal an old line from Bob Dylan, but man… The Times They Are a-Changin’.

The recession has hit everyone hard, but state and local governments are being hit severely hard since there is far less revenue to tax and they still have to keep the basic services flowing.  Back in October 2008, I was actually called out for being too “Orwellian” with my Wall Street trickle down prognostications where basic services and basic infrastructure could be negatively impacted unless we received the now infamous bailout bill from the federal government.

And a trillion plus dollars later (I’ve actually lost count how many billions we’ve spent thus far), local governments are going to charge you a few hundred bucks when you dial 911?

A Pro Argument for Accident Response Fees!

Maybe I’m nuts, but I actually love this idea!

Some years ago, I lived next door to a state trooper who went on and on (think Al Bundy) about the consistency of the bad drivers who caused auto accidents.  He said one of the most simplistic ways to stop minor traffic accidents would be to make bad drivers (e.g. those who caused the accident) pay him on the spot or giving them a bill just for showing up.  First offense would be $250, second offense would be $500, etc.

I would presume the humiliation of writing a check to your county government after sideswiping a minivan trying to get a better parking space at WalMart would be just enough to curb those reckless driving habits.

If you disagree, consider what happens when you get caught breaking the speed limit.  You may do it two or three times, but after a while, paying $100s in fines, hikes to your auto insurance, and the idea of sitting through a driver’s re-education class again might change your lead foot ways.

Bringing Back Luxury Taxes & Sin Taxes

The NY Times article made several references to less common or rarely enforced fees local governments could generate new “fee-based” income, but is there anything else you feel deserve a tax hike or item specific fee?

I’ve got a few in mind!

1. Cigarettes.  Raise the taxes again, and again, and again.  Cigarettes are nothing but a 30 year death sentence and a monster drain on Medicare since 55% of smokers are among the “working poor” and 1 in 4 smokers live below the poverty line.  If health care can make or break our country’s financial future, why would you give people a loaded gun to shoot themselves with?
2. Gas Guzzling Autos.  You want to drive an off-the-hook luxury SUV with 22″ rims – be my guest!  But you’re going to pay a stiff luxury tax for it.  Help your future great grandchildren by buying something that gets 25mpg or more.
3. Water Guzzling Homes.  If you live in a desert, you shouldn’t have a green lawn.  Water will become more valuable than oil someday, so if you want to use 3x the average amount of water provided by the local municipal water source, you get a luxury tax.
4. Financial Trading.  I’m committing trader heresy here, but I think it’s time we add an additional transaction fee to equity transfers of ownership (e.g. the buying and selling of stock).  Look, if you can afford to buy 1000 shares of Exxon Mobil or Proctor & Gamble, you can pay an additional $5 per 100 share block.  Everyone should do their part.

Why shouldn’t those that live in the land of excess or dabble in “bad” side of personal behaviors be forced to pay a little extra?

And in the future, if I begin to use one or more of these “luxuries” or use a tax sponsored service, then I’ll know what I’m going to do will cost me heavily since I broke outside of the norm.

After all, if one person takes more from society than the next person, shouldn’t they be required to pay more?

Got any fees or taxes we should add to the list?

Photo by jakesmome

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