You Want to Tax What? Government Gets Desperate

Jonathan Miller, the president of InsureNet, an auto insurance verification service, projected that Chicago could see an annual windfall of at least $200 million from such a program.

Others said the program would provide more than just fiscal benefits. It could encourage more people to get insurance.

Charging for 911

Emergencies cost money. Now officials at the Fire Department of the city of Santa Rosa, Calif. hope that the public will help defray the cost.

The department is proposing that Santa Rosa residents pay a $4 per month "subscription" to fund 911 calls. Residents who choose not to subscribe would be billed $350 for each 911 call they make.

"We're into our third round of budget reductions with layoffs and we're looking for every opportunity we can to try to fill a gap in the revenue coming in compared to the cost of service going out," said Deputy Fire Chief Mark McCormick.

McCormick said that 15 California cities have similar subscription programs that have proved successful. Contrary to what some expect, he said, the programs haven't led to a decrease in 911 calls.

But at least one city concluded that 911 subscriptions were a bad idea: Ventura, Calif., dropped its program late in 2008 after encountering billing problems, complaints and a lawsuit.

Soda, iTunes and Haircuts

In New York, some unusual tax ideas have gotten the boot thanks to government stimulus funds. Last week, New York Gov. David Paterson announced that he and state legislature leaders agreed to use more than a billion dollars of stimulus money in lieu of Paterson's proposals to tax sugary drinks, haircuts, manicures, bowling, skiing and online music downloads, among other products and services.

But New York isn't in the clear yet, Paterson said.

"[Officials] cannot treat a temporary windfall from Washington as an excuse to avoid the tough choices we must inevitably make to get our fiscal house in order," he said in a recent statement. "Federal funding will cover only a fraction of our overall budget deficit, and the economic outlook remains uncertain."

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