Q: When is a tax not really a tax?

A: When a majority of the Santa Fe City Council says it isn’t? I don’t know the real answer to that question, but if there’s any group that can raise revenues without raising taxes, the ever-creative liberals at the City of Santa Fe might just be it. See the Santa Fe New Mexican’s coverage of a new proposal to levy a 10 cent fee on each paper bag used by shoppers. A prior attempt by city councilor to tax paper bags was killed on concerns that it was illegal, but the Council has changed the name of the fee from “service fee” to “environmental fee” in an effort to skirt the law.

Interestingly, the City’s Assistant City Attorney Theresa Gheen, claimed that the new fee passes legal muster, but when asked to explain why the fee wasn’t an illegal tax, Gheen couldn’t. The fee hasn’t passed Santa Fe’s City Council yet and it only passed on 3-2 vote. There is still time to win the political argument against this tax increase, but if the tax hike is passed, there will definitely be a legal argument as well.

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One Reply to “Q: When is a tax not really a tax?”

  1. “Environmental Fees” are just like the airline bag fees, another way to add cost to what you used to get when you bought goods. Same as fuel surcharges even when fuel prices are at lowest rate in years. The City should have to prove that the use of bags results in additional costs at their end. I certainly hope the Santa Fe business community is fighting back on this issue.

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