It’s tax time and if you feel like you’re paying more than your fair share, it’s because you are. But it’s not what you are thinking. I’m talking about a local problem, not your federal or state taxes. That’s a whole other kettle of fish.
What I’m talking about is the fact that those millions of annual visitors to Laguna are not paying their fair share of what they cost the city to provide all the extra services they require. Over the past weeks there have been columns and letters in the Indy about the $20 to $30 million per year that the residents are subsidizing the visitors and the local businesses that are mainly tourist oriented because the revenue the city receives from visitors does not cover their costs.
This is about $2,000 per year that the average Laguna household pays the city that should instead be paid by visitors. What would we do if the city found a solution? For one, we could ask for a $2,000 per household annual refund. And if you don’t think the city is likely to issue refunds, the least we could expect is that the money would be used to enhance the quality of life for residents and probably the tourists, too. So, everyone should be happier if the city could come up with a solution.
And there are solutions. There have been suggestions of generating more revenue from sources like parking, or from other use taxes. One suggested that Laguna adopt a congestion pricing idea like those that already exist in other cities.
But there are other ideas like removing the cap on business license fees. As is, Laguna charges a fee for business licenses on a sliding scale. But all these fees are subject to a cap. The average fee is about $232 per year per business. Considering Laguna businesses report over one-half billion dollars of annual revenue, $232 doesn’t seem like a lot. And with the cap, it is reasonable to conclude that some of the largest businesses pay the same business license fee as some of the smallest. That doesn’t seem fair to the smaller businesses. Why not remove the cap? Seems fair.
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