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Tuesday, September 22, 2009

Which is worse: A tax on the arts or a break for big business?

Don’t get mad about the new tax on arts and cultural organizations.

Get mad that it was necessary in part because of a big tax break for corporations…one that will cost you and other taxpayers nearly $100 million, the same amount to be generated by the so-called “culture tax.”

The “Single sales factor “ is essentially a technical change that will mean big bucks for corporations like Hershey Foods and U.S. Steel – companies based in Pennsylvania that do most of their business elsewhere.

In fact, according to an analysis by the Pennsylvania Budget and Policy Center, the change will be a huge windfall for a relatively small number of companies. These businesses would overwhelmingly be national corporations. Local and regional companies would suffer.

Why would lawmakers give tax breaks to big corporations during a recession and make up the money by taxing the arts? Welcome to the crazy world of state budget negotiations.

Since the start of the budget process, Gov. Rendell has argued that the state needed more revenue to deal with the deficit. One of his ideas was to temporarily halt a planned phase-out of the Capital Stock and Franchise Tax, which would have saved more than $800 million over two years.

At first, Republicans balked at the idea of halting the planned tax reduction. When it became clear that Gov. Rendell was digging in his heels, the GOP offered a compromise. They would agree to freezing the phase-out if Rendell would consent to re-writing the tax code for the benefit of big businesses. Desperately seeking compromise, Rendell traded the $100 million for the $800 million.

There was just one problem: He now needed $100 million to avoid additional cuts. And so, to avoid making more cuts, lawmakers turned to taxing the arts. Essentially, our arts and culture community will be paying the price so big businesses can get a tax break. Another great idea from Harrisburg.
Posted by Ben Waxman @ 1:53 PM  Permalink | 11 comments
Comments   
  • 0 like this / 0 don't   •   Posted 2:28 PM, 09/22/2009
    Remember there is no campaign finance limits in PA.
    — seand
  • 0 like this / 0 don't   •   Posted 2:44 PM, 09/22/2009
    well then those companies getting the breaks, they should increase their commitments to artsand culture funding. Problem solved.
    — PaulDeon
  • 0 like this / 0 don't   •   Posted 2:49 PM, 09/22/2009
    Without Big Business, no one could afford any of the arts. How many jobs did Andy Warhol create Vs. Bill Gates.
    — sillybilly
  • Comment removed.
  • 0 like this / 0 don't   •   Posted 3:06 PM, 09/22/2009
    in fairness, they are actually raising business taxes elsewhere. this is a narrow view, the capitol stock tax is being raised.
    — dreinterests
  • 0 like this / 0 don't   •   Posted 4:14 PM, 09/22/2009
    I think there is already an amusement tax that at least the sports teams pay
    — PaulDeon
  • 0 like this / 0 don't   •   Posted 4:20 PM, 09/22/2009
    Think the amusement tax is a city tax. How did movies get exempt from this tax?
    — phillyccgwm
  • 0 like this / 0 don't   •   Posted 5:56 PM, 09/22/2009
    One should be mad at taxes in general, should be furious at the 8% sales tax now in Philly. Sales tax hikes in general hurt the poor and those stuck in Philly more than anyone else and it is serfdom and enslavement.
    — uandwhosearmy
  • Comment removed.
  • Comment removed.
  • 0 like this / 0 don't   •   Posted 1:49 PM, 09/24/2009
    Even as someone who spends way more every year going to Phillies games than museums and plays, I feel compelled to say this: Exempting movies and sporting events from this tax is bull. I'm not a fan of the tax. (I'm not a big fan of anything that's going to take my money.) But if someone has to pay extra tax to see mummies in sarcophagi, they should have to pay extra tax to see CG mummies eating people's brains. This attempt to punish people who consume "high culture" for being elitists or whatever is more of an insult to people like me who don't go to movies more often than plays and sporting events more often than art galleries. Movies and sports are very much "cultural" events and exempting them from a "culture tax" is insulting to people like me who spend more on them than on supposed "high-culture."
    — zackn


11 comments
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