Taxes

Imperial Revenuers

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West Virginia takes an innovative approach to raising revenue: taxing businesses in other states.

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  1. Why is this surprising? This is the state, of course, that has repeatedly reelected Robert Byrd since the mid 1840s.

  2. Power corrupts, and I guess you don’t even need absolute power to be corrupt completely.

  3. So I guess they don’t want West Virginians to have credit cards.

  4. What happens if MBNA decides not to pay up? What is forcing them to do so?

  5. Why stop at taxing US companies in other states?

    Why not tax the income that Chinese companies earned when they produced the stuff that’s sold in West Virginia?

    And whether or not any of said stuff was actually sold in West Virginia, it had an indirect effect on the state’s domestic markets, which is justification tax it anyway.

  6. WV ought to watch what it wishes for. Wait until surrounding states start to tax WV companies that export coal, chemicals, etc. to
    their states. At least MBNA has the resources to tell them to pound sand and, if sued, pay for a SCOTUS case.

  7. Federalism. Competition in taxation schemes. Competition. Let the best state win. Etc. etc.

  8. Their argument appears to be that “commerce,” as used in the Constitution, means things pulled by horses. Credit cards, not being delivered by horses, are, therefore, not “commerce.”

    I think that would pretty much torpedo every federal regulatory prerogative. Maybe we should let them throw this one against the wall…

  9. A dumb idea…and exactly how is WV going to enforce this tax?

  10. If WV wanted to break balls they could make MBNA adhere to WV usury laws when dealing with WV cardholders rather that DE law. Of course. the end result would still be no more MBNA credit cards in WV.

  11. I think that would pretty much torpedo every federal regulatory prerogative.

    Works for me.

  12. Our founding fathers may not have had plumbing and electricity, but they also didn’t have P.L. 86-272 enacted by a subsequent congress limiting a state’s ability to tax activity that does not have substantial nexus within the state.

    How would West Virginia enforce this? At some point MNBA may wish to use state courts to enforce collection actions.

  13. For what it’s worth, I think the W VA supreme court is reading way too much into what Quill left out.

  14. Why stop inside the US? We can solve the Budget Deficit by taxing non-citizen living outside of the US borders.

  15. Los Angeles County beat them to it when they tried to tax property in orbit.

  16. West Virginia is a small state; maybe companies should start floating the idea of simply not doing business with its residents.

    That would get this killed post haste.

  17. West Virginia is a small state; maybe companies should start floating the idea of simply not doing business with its residents.

    I think that is part of the idea Half Bee.

  18. Hmm…Sam’s onto something.

    I suppose the poor states have nothing to lose, really.

  19. For example, maybe West Virginia thinks that MBNA is issuing more credit cards than are healthy for the longrun economic health of the state. So you set up the tax law to chase away people like MBNA.

    Now that is not a libertarian approach (part of the reason I am not moving to West Virginia).

    That may not even be the wisest approach to solve the problem of easy credit / harsh consumer bankruptcy. However, before anyone criticizes West Virginia here, you should probably have an alternative approach for West Virginia to handle the perceived problem. I mean if you are speaking with a libertarian, then you can simply say that consumer bankruptcy is not an issue a state government cares about at all. However, when discussing with the non-libertarian majority, you better have something better than that if you want to cut any ice.

  20. As the poet said, “What California tried yesterday, the rest will try tomorrow.”

    Or something like that.

  21. Heh heh.

    Working on new California environmental regulatory compliance issues right now.

    Actually on RoHS, the EU was 6 months ahead of California even.

  22. West Virginia has a 9% corporate income tax? Are they insane? No wonder they are so poor, no sane person would set up shop there except to service locals.

  23. The State of California taxes me and many others when we make any money while IN their state, or are paid by a company based there, in spite of the fact that I do not and never have lived in that state.

    Part of their justification in my case is that the state I currently live in doesn’t have an income tax, and that I ought to be paying an income tax to SOME state, so it might as well be thiers. My accountant’s head nearly exploded when he learned of this legal thievery.

  24. Part of their justification in my case is that the state I currently live in doesn’t have an income tax, and that I ought to be paying an income tax to SOME state, so it might as well be thiers. My accountant’s head nearly exploded when he learned of this legal thievery.

    a better justification is that California uses its tax money to build a state where the coolest businesses with the best literary tastes set up shop. It can be expensive to maintain a state like that, but discerning publishers seem to require such a context somehow.

    maybe time for Phantagrph. to set up shop in Reno?

  25. If WV wins, MBNA will do one of two things:

    1) Cease to issue cards to WV residents and change their advertising accordingly.

    or [more likely]

    2) Set up MBNA(WV) Inc. to handle all their credit card business there.

  26. As to how WV could enforce this, there are several ways. One one be to take a clue from the feds play-book: Lure some of the executives to WV for some staged event and then arrest them.

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