ELDER PATRIOT – Government’s insatiable need for revenue in order to fund its out-of-control growth invariably leads to abuse.
Many departments of government have been ordered to increase revenues in order to cover the costs of their growth. Because of mainstream media reports, we all know this to be true of police departments across the country where police are responsible for meeting their quota of tickets on a monthly basis.
Some years ago the mayor of a municipality in New Jersey revealed that he had told his police force of they needed to find new sources of revenue to cover their highest-in-the-state salaries. The state Department of Transportation had realigned a difficult and confusing traffic circle that had yielded millions of dollars in ticket revenue from confused drivers. The new road network would eliminate this revenue stream almost completely. For those of you who might think this was a one-off instance, think again.
The New Jersey Division of Taxation works in a similar manner. Agents were tasked with raising $1,000,000 annually. Audits, which generally require a week of the auditor’s time, could usually be settled for around $20,000. Businessmen, under the advice of their accountants who understood the expense and futility of challenging a government agency in that agency’s own administrative courts, dutifully paid the “man” and went about their business. It was and remains extortion.
Like the card game Fizzbin from Star Trek they make the rules up as they go along. As a person who had the temerity to challenge a sales tax audit I can attest to this. When asked for the methodology they had used and if they were consistent in the application of that methodology they could provide neither. I did get them to claim that they had a “study from California” which contradicted my assertions. Despite repeated requests by my attorney they never provided it and, eventually admitted in court that the study that they had used as a hammer against me did not exist. It mattered little to the court. As the penalty for challenging them, I received fines and penalties between 3-4 times their original settlement offer. That was on top of the original determination. Then I was threatened with non-renewal of my liquor license if I didn’t make payment immediately. The ruling had to have been meant to have a chilling effect on the subjects of
Today, I learned of another sales tax audit that stretches credulity. The owner of a tavern that reports sales well in excess of industry averages has come under their scrutiny. Apparently, returning 25% to the bottom line suggests he’s been dishonest. All of his expense ratios are within, or better than, generally accepted industry accounting standards. The auditor has accepted his liquor sales without further questions. His ratio of food cost to sales is below industry standards, but since food sales comprise 75% of his overall sales, challenging him on this offers the biggest opportunity for their shakedown.
Seeking to avoid the expense and time required by the appeals process, the owner offered to pay the sales tax. That is no longer good enough. They now want him to pay taxes on the income that he never made. The mob would blanch at such heavy-handedness.
Stories like these are more the norm in New Jersey than the exception and go a long way to explain why it’s the number one outward migration state in the country over the past five years. New Jersey is losing more wealth, per capita, than any other state.
While these tactics predate the Christie administration, the self-proclaimed presidential candidate cannot run away from the fact that he has done nothing to stop the rampant culture of extortion by his state apparatus further fueling the flight of entrepreneurs and wage earners to more welcoming and less corrupt states.
The corrupt leveraging of government departments in New Jersey used to fund the bloated wages, benefits and pensions of a burgeoning bureaucracy that continues to grow beyond all necessary levels should serve as a warning to Americans everywhere. When those that write and enforce the laws are also the largest employer the situation is ripe for corruption.