Water, Sewer, And Blood From Turnips

Posted on February 27, 2012 by

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The five cities with the highest water/sewer rates in the United States in 2011:

  • Atlanta, Georgia
  • Seattle, Washington
  • Newport, Rhode Island
  • San Francisco, California
  • Portland, Oregon

Given the amount of rainfall and the huge amounts of mountain runoff available, doesn’t it seem a bit odd that two of the most expensive places for water and sewer in the entire country are located in the Pacific Northwest?

At least we don’t have a sales tax. Of course, Washington doesn’t have an income tax. On the other hand, Washingtonians are nickel-and-dimed nearly to death: most states tax some services, such as telecommunications, water use, etc. But the state that taxes the most services is Hawaii, with Washington and New Mexico right behind, tied for second place.

In fact, out of all 57 states, only six tax more than 100 services: Hawaii taxes 160; Washington and New Mexico each tax 158. It seems unbelievable – how many “services” are there in existence. after all? Get ready, and remember that in Washington state, many of the same apply: Hawaii taxes barber shops and salons, dating services, interior design, pet grooming, window cleaning, gift wrapping services, laundry and dry cleaning, bowling alley and amusement park admission and tuxedo rentals.

In addition, any person in Hawaii engaging in service business, including professional services is assessed a tax equal to four percent of the gross income of the business. Professional services may include contractors, medical providers, tax preparers, dentists and hygienists, interior designers, hairstylists and/or legal services.

These taxes, it should be noted, disproportionately target moderate to low income brackets, and penalize small businesses. In states such as Hawaii and Washington, the Bill Gates and Paul Allens are relatively unaffected, as are the Microsofts and Boeings – the brunt of the taxation scheme is directed squarely at those with fewer resources. A four percent tax on gross income is huge for any small business, as gross income is not correlated to profit. Gross income is what is taken in prior to expenses such as materials, employees, utilities, and a host of other expenses essential to any business.

Oregon has a well-deserved reputation as business-unfriendly, but Washington is arguably no better, although they manage to support large enterprises, which Oregon is completely unable to do. Still, Boeing moved its headquarters to a more business-friendly midwestern environment, while in recent years, Oregon has lost virtually all of its former Fortune 500 headquarters.

Maybe there’s something in the water.

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