Gov. Paterson Unveils 2009 NY Budget
Recently, NY Gov. David Paterson unveiled his 2009 Budget Proposal.
From the Daily News:
Trying to close a $15.4 billion budget gap, Paterson called for 88 new fees and a host of other taxes, including an “iPod tax” that taxes the sale of downloaded music and other “digitally delivered entertainment services.”…Movie tickets, taxi rides, soda, beer, wine, cigars and massages would be taxed under Paterson’s proposal. It also extends sales taxes to cable and satellite TV services and removes the tax exemption for clothes costing less than $110.
In these hard times it is obvious that the Governor would need to increase taxes to balance the state budget. In a state like New York, home to one of the most populous and active cities in the world, balancing the budget is no easy task. However; is it really necessary to be taxing movie tickets and taxi rides?
NY Gov. David Paterson announces 2009 budget
It seems that a much better alternative would be to tax things that are bad for people. Soda and beer are prime examples. If people insist on using things that will hurt them in the long run, the government might as well make a profit off ofit. We have seen this work with the cigarette industry. Even several smokers are accepting of the taxes on cigarettes since they know why the prices are so high. Taxing things like iTunes music will just encourage people to pirate and steal more. Taxing movie tickets will just hurt the industry, since $10 a ticket has already caused many movie-goers to simply wait for the DVD (which of course they can now illegally download since iTunes is too expensive). The budget also calls to cut services to schools and hospitals.
It seems to me that there is a more pragmatic approach to this budget deficit. Smart taxing can offset the anger from unwise taxing, and from the anger of cutting services. However, I am no economist, and am no where close to the governors ear. Where is the NY state economy going? Will the tax increases and service cuts work?
Tags: 2009, 2009 Budget, Gov. Paterson, Governor Paterson, New York, NY, NY Tax Hike, Paterson
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December 18, 2008 at 12:34 pm
As someone who likes going to movies, I’m not too excited about a tax on movie tickets either, but your idea that people have been avoiding the movie theater because of high ticket prices is actually not true. Over the last few years, more people have been going to the movie theater and box office revenues have been going up. (see http://www.mpaa.org/2007-US-Theatrical-Market-Statistics-Report.pdf) Movies are one of the few things that have historically been “recession-proof,” so I don’t expect a small tax on movie tickets to change that.
I’m really curious about how he plans to put an iTunes tax in place. The Supreme Court decided a few years ago that you could only tax internet sales if there is an actual brick-and-mortar location within the state doing the taxing. There are Apple stores, but I don’t know if that qualifies–iTunes is an online-only environment. It will be interesting to see.
December 18, 2008 at 1:27 pm
I would be curious to see at what point movies are not “recession-proof”. I cannot possibly imagine that people would continue to see movies if the price were to rise much higher
December 20, 2008 at 12:16 am
Well saying more people have been going to the movie theater is true, but it is deceiving.
According to the U.S. Census from 2000 – 2006 the population grew by 6.4%. Whereas according to these statistics movie attendance only grew at 1.2%
We can see that the rate of movie attendance isn’t matching the rate of population growth. And yes, while the revenue from movies has increased from 2000 to 2006 we do have to take into account the large percentage increases in ticket prices.
With studios creating more and more expensive movies the prices have to go up accordingly. Time will tell how “recession proof” movies actually are.
December 20, 2008 at 11:15 am
I agree with your argument, but I think it is incorrect to compare population growth to the amount of ticket sales. This does not account for habits of the original population. For example, if the population grew 10% in 5 years from 10 to 100 people, but those 90 new people never went to see a movie, and the original 10 went twice as much, the statistic would reflect the 100 people, even though they never saw a movie.
April 14, 2009 at 6:38 pm
I was curious about the budgets last time, but i have no interest.