IDS Budget and Tax Committee

[Yelnoc]

     Don't have time to look right now, but per the Unified Law Code Initiative our electricity excise tax should be the same as it is over in Georgia. If it turns out there is none there, then we can either make one or just leave it stand at $0.

This site had the following to offer on the subject.

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I say we just assume that the electric excise tax is 0% for simplicity and void related initiatives.

[Yelnoc]

Thank you very much Badger.  So in summary, $35.6 Billion is the income from all state personal and corporate income taxes combined.  $63.75 Billion would be the regional income if the IDS had a 6% corporate and personal income tax rate.  Correct?

The first part I went ahead and added to the budget.  Unfortunately, the IDS has an 8.6 corporate tax rate while our personal income tax is the aggregate of Georgia's tax.  I suppose we could pass legislation to fix this; we'll have to discuss this.

[Yelnoc]

     5.8% should be fine, unless we want to change that as well.

     The corporate income tax is problematic insofar as it makes us uncompetitive when regions like the Mideast have graduated rates that max out at 5%. If we lowered the corporate income tax rate to 5.8%, it would simplify the budget process & help the region's economy.

Sure.  We'll have to go through the legislature I suppose.  Should the bill set both income taxes at 5.8% or just corporate?

[Yelnoc]

     5.8% should be fine, unless we want to change that as well.

     The corporate income tax is problematic insofar as it makes us uncompetitive when regions like the Mideast have graduated rates that max out at 5%. If we lowered the corporate income tax rate to 5.8%, it would simplify the budget process & help the region's economy.

Sure.  We'll have to go through the legislature I suppose.  Should the bill set both income taxes at 5.8% or just corporate?

     Income taxes are already 5.8%, so that's not a problem.

Oh, right.  I misread that.  I'll go ahead and introduce a bill.

[Yelnoc]

In the meantime, we can work on this.

-Property Taxes/Tax-Property/Southeast Nuclear Energy Initiative, Chapter 4

The relevant section is bolded.

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[Yelnoc]

How about we just assume that the maximum is the actual?  Most likely, the real property values of these nuclear plants are locked away in some real life county office.

Property taxes tend to be a county-level affair.  Since our goal is to combine the state and regional governments, do you think we could just ignore this initiative, considering it does not impact revenue in real terms?

[Yelnoc]

2011 Budget

Regional Spending

Pensions
-Base: $0

Health care:
-Base: $0

Education:
-Base: $0
-Tertiary Education/Other Capital Outlay-Higher Education/Southeastern Educational Incentive Act: $3.5 billion
-Pre-Primary through Secondary Education/Other Capital Outlay - Elementary and Secondary Education/School Choice Initiative: $56.4 billion
-Total: $59.9 billion

Defense:
-Base: $0

Welfare:
-Base: $0

Protection:
-Base: $0

Transportation:
-Base: $0

General government:
-Base: $0

Other spending:
-Base: $0
-Cultural Services/Pentagram Creation Act: $200 million (1 time expense)
-Total: 200 million

Interest:
-Base: $?

Balance:
-Base: -$?

Σ
-Base: $0
-Total: 61.1 billion

Regional Revenue

Income Taxes:
-Base: $0
-Corporate Income Tax/Tax-Corporate Net Income/Put the "free" back in Free Enterprise Bill: 32.5 billion
-Corporate Income Tax/Tax-Corporate Net Income/Southeast Nuclear Energy Initiative, Chapter 4: -66.1 million (-0.0661 billion)
-Corporate Tax Rate: 8.6% (part of Free Enterprise Bill above - remember other provisions).
-Personal Income Tax Rate: 0% (none)
-Total: $32.4339 billion ($32,433,900,000)

Social Security Taxes:  
-Base: $0

Ad-valorem Taxes:
-Base: $0
-Excise Taxes/Tax-Alcoholic Beverage Sales/Southeast Alcohol Initiative, Section 8: $1.3127 billion ($1.00/proof liter or $0.385/gallon for beer, $0.909/gallon for wine, $3.31/gallon for spirits)
-Excise Taxes/Tax-Tobacco Products Sales/Southeast Tobacco Initiative, Section 6:  $0.04/cigarette ($6,034,000,000/year), $0.08/cigar ($80,000,000/year), $2.00/kg tobacco ($24,000,000/year)
-Excise Taxes/Tax-Marijuana Products Sales: $3.00/ounce ($48,000,000/year)
-Sales Taxes/Tax-Public Utilities Sale/Southeast Nuclear Energy Initiative, Chapter 4: 80% of standard electricity excise tax: $0
-Sales Taxes/Tax-Public Utilities Sale/Southeast Biomass Initiative, Section 3: 80% of standard electricity excise tax: $0
-Property Taxes/Tax-Property/Southeast Nuclear Energy Initiative, Chapter 4: n/a ($0)
-Transportation/Tax-Motor Fuel Sales/Transportation Commission Initiative, Chapter 3, Section 22: $0.08/liter ($17,284,230,161/year)
-Transportation/Tax-Motor Vehicle License/Fair Consequences Initiative, Section 3: $10,700,000/year
-License/Tax-Other License/Off-Shore Religious Organizations Initiative, Section 2: n/a ($0)
-Total: $24,793,630,161

Fees and Charges:
-Base: $0
-Other/Charges-All Other/Pentagram Creation Act: $5,700,000/year
-Other/Charges-All Other/Safe Roads Initiative, Section 6: $44,400,000/year
-Total: $50,100,000 ($0.0501 billion)

Business and Other Revenue:
-Base: $0
-Other/Miscellaneous-Net Lottery Revenue/Southeast Lottery Regulations, Section 6 (Amended by Expanding Choice Initiative)
-Total: ?

Total Direct Revenue:
-base: $0

Gross Public Debt:
-Base: $0

State Spending

Pensions
-Base: $3.81 billion

Health care:
-Base: $121.9 billion

Education:
-Base: $0 billion (pre-Educational Hotfix Act)
-Base: $48.9 billion (post-Educational Hotfix Act - original figure was $73.4 billion)
-Total: $48.9 billion

Defense:
-Base: $0.6 billion

Welfare:
-Base: $40.4 billion

Protection:
-Base: $21.5 billion

Transportation:
-Base: $28.2 billion

General government:
-Base: $7.4 billion

Other spending:
-Base: $18.7 billion

Interest:
-Base: $7.4 billion

Balance:
-Base: -$4.4 billion

Σ
-Base: $352.1 billion

State Revenue

Income Taxes:
-Base: $35.6 billion
-Corporate Tax Rate: ?
-Personal Income Tax Rate: ?
-Total: ?

Social Security Taxes:  
-Base: $15.1 billion

Ad-valorem Taxes:
-Base: $252.3 billion

Fees and Charges:
-Base: $107 billion

Business and Other Revenue:
-Base: $132.5 billion

Total Direct Revenue:
-base: $544.5 billion

Gross Public Debt:
-Base: $598.7 billion

[Yelnoc]

Alrighty then.  Now for this.

-Transportation/Tax-Motor Fuel Sales/Transportation Commission Initiative, Chapter 3, Section 22: $0.08/liter

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[Yelnoc]

     I'm guessing the reason that the state spending on education is 2/3rds of the original is because we only repealed the School Choice Initiative about 1/3rd of the way through the year?

That is correct.  When next years budget is drafted, someone will have to remember to revise that figure upward.

I found a good site for 2006 fuel numbers that I think we can base this off of.  I'll go combine gasoline and diesel sales for the IDS states and be right back.

[Yelnoc]

Fuel Consumption (1000s of Gallons)
Alabama         3,450,983
Arkansas        2,084,115
Florida        10,487,556
Georgia         6,549,461
Louisiana       3,409,534
Mississippi     2,304,533
North Carolina  5,523,563
South Carolina  3,263,772
Tennessee       4,138,498
Texas          15,864,117
Total          57,075,132,000

Note: State numbers are 1000s of gallons, the total is the actual figure.

That is equal to 216,052,877,018 Liters.  So eight cents per liter generates $17,284,230,161 per year. 

[Yelnoc]

And now this.

-Transportation/Tax-Motor Vehicle License/Fair Consequences Initiative, Section 3

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[Yelnoc]

This is the last Ad-valorum tax!

-License/Tax-Other License/Off-Shore Religious Organizations Initiative, Section 2

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[Yelnoc]

Unless we have any offshore religious institutions, I am pretty sure we can go ahead and ignore this.

[Yelnoc]

Ok, one last initiative and we are done with the regional portion of the budget!!!

Other/Miscellaneous-Net Lottery Revenue/Southeast Lottery Regulations, Section 6 (Amended by Expanding Choice Initiative)

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[Yelnoc]

I am thinking that from this we aren't going to be able to place revenue figures in the budget.  Is it another $0 or should we make a note in the education section?

[Yelnoc]

     The Education Tax is equivalent to the difference between the Education budget & the amount put into the Lottery Education Fund, which is equivalent to 90% of what is raised by the regional lottery. If we could find out how much that is, it would be possible to figure out the value of the Education Tax.

Are there any other statutes in the region relating to the lottery?

[Yelnoc]

From what I can tell, this whole program is outside the IDS budget in terms of revenue and expenditures.  I think we are done.  I'll post the budget below one last time and then we can move onto the last phase; combining the budgets.

[Yelnoc]

2011 Budget

Regional Spending

Pensions
-Base: $0

Health care:
-Base: $0

Education:
-Base: $0
-Tertiary Education/Other Capital Outlay-Higher Education/Southeastern Educational Incentive Act: $3.5 billion
-Pre-Primary through Secondary Education/Other Capital Outlay - Elementary and Secondary Education/School Choice Initiative: $56.4 billion
-Total: $59.9 billion

Defense:
-Base: $0

Welfare:
-Base: $0

Protection:
-Base: $0

Transportation:
-Base: $0

General government:
-Base: $0

Other spending:
-Base: $0
-Cultural Services/Pentagram Creation Act: $200 million (1 time expense)
-Total: 200 million

Interest:
-Base: $?

Balance:
-Base: $26,327,630,161

Σ
-Base: $0
-Total: 60.1 billion

Regional Revenue

Income Taxes:
-Base: $0
-Corporate Income Tax/Tax-Corporate Net Income/Put the "free" back in Free Enterprise Bill: (see personal income tax rate)
-Corporate Income Tax/Tax-Corporate Net Income/Southeast Nuclear Energy Initiative, Chapter 4: -66.1 million (-0.0661 billion)
-Corporate Tax Rate: 8.6% (part of Free Enterprise Bill above - remember other provisions).
-Personal Income Tax Rate: 5.8% ($$61,650,000,000/year)
-Total: $61,583,900,000

Social Security Taxes:  
-Base: $0

Ad-valorem Taxes:
-Base: $0
-Excise Taxes/Tax-Alcoholic Beverage Sales/Southeast Alcohol Initiative, Section 8: $1.3127 billion ($1.00/proof liter or $0.385/gallon for beer, $0.909/gallon for wine, $3.31/gallon for spirits)
-Excise Taxes/Tax-Tobacco Products Sales/Southeast Tobacco Initiative, Section 6:  $0.04/cigarette ($6,034,000,000/year), $0.08/cigar ($80,000,000/year), $2.00/kg tobacco ($24,000,000/year)
-Excise Taxes/Tax-Marijuana Products Sales: $3.00/ounce ($48,000,000/year)
-Sales Taxes/Tax-Public Utilities Sale/Southeast Nuclear Energy Initiative, Chapter 4: 80% of standard electricity excise tax: $0
-Sales Taxes/Tax-Public Utilities Sale/Southeast Biomass Initiative, Section 3: 80% of standard electricity excise tax: $0
-Property Taxes/Tax-Property/Southeast Nuclear Energy Initiative, Chapter 4: n/a ($0)
-Transportation/Tax-Motor Fuel Sales/Transportation Commission Initiative, Chapter 3, Section 22: $0.08/liter ($17,284,230,161/year)
-Transportation/Tax-Motor Vehicle License/Fair Consequences Initiative, Section 3: $10,700,000/year
-License/Tax-Other License/Off-Shore Religious Organizations Initiative, Section 2: n/a ($0)
-Total: $24,793,630,161

Fees and Charges:
-Base: $0
-Other/Charges-All Other/Pentagram Creation Act: $5,700,000/year
-Other/Charges-All Other/Safe Roads Initiative, Section 6: $44,400,000/year
-Total: $50,100,000 ($0.0501 billion)

Business and Other Revenue:
-Base: $0
-Other/Miscellaneous-Net Lottery Revenue/Southeast Lottery Regulations, Section 6 (Amended by Expanding Choice Initiative): $0 (not directly related to the budget)
-Total: $0

Total Direct Revenue:
-Base: $0
-Total: $86,427,630,161

Gross Public Debt:
-Base: $0
-Total: ?

State Spending

Pensions
-Base: $3.81 billion

Health care:
-Base: $121.9 billion

Education:
-Base: $0 billion (pre-Educational Hotfix Act)
-Base: $48.9 billion (post-Educational Hotfix Act - original figure was $73.4 billion)
-Total: $48.9 billion

Defense:
-Base: $0.6 billion

Welfare:
-Base: $40.4 billion

Protection:
-Base: $21.5 billion

Transportation:
-Base: $28.2 billion

General government:
-Base: $7.4 billion

Other spending:
-Base: $18.7 billion
-Puerto Rico: $17.27 billion

Interest:
-Base: $7.4 billion

Balance:
-Base: -$4.4 billion

Σ
-Base: $311.7 billion

State Revenue

Income Taxes:
-Base: $35.6 billion
-Corporate Tax Rate: ?
-Personal Income Tax Rate: ?
-Total: ?

Social Security Taxes:  
-Base: $15.1 billion

Ad-valorem Taxes:
-Base: $252.3 billion

Fees and Charges:
-Base: $107 billion

Business and Other Revenue:
-Base: $132.5 billion
-Puerto Rico: 24.96 billion

Total Direct Revenue:
-base: $531.9 billion

Gross Public Debt:
-Base: $598.7 billion

[Yelnoc]

Amazingly, this budget leaves us about $3 million in the hole.  Now, onto combination.  That part will have to go through the legislature.  We can go ahead and get rid of the revenue from state corporate taxes because of the bill we just passed.  I'm thinking we should pass an omnibus bill mandating all of the transfers.  This part we actually have some control over the final result, because we can choose which items to take from state budgets and which to leave as is in the regional budget.

[Yelnoc]

     Actually, we never added in the income tax stuff. We already have a ~5.8% income tax rate, which will certainly eliminate the gap when accounted for.

So we multiply the tax paying portion of the IDS population by 5.8.  The question is, how many citizens of the IDS are taxpayers?

[Yelnoc]

So, we currently have an epic surplus of $63,077,630,161.  Once the legislature elects a new speaker, one of us will have to write up an omnibus bill combine the two budgets.

[Yelnoc]

     I'm not sure how one would write such a bill, unfortunately. Perhaps say that we are counting all state spending & revenue as part of the region's spending & revenue for accountability purposes?

Basically, though we would want to specify which portions from the state ledgers are being combined and which are being dropped.

[Yelnoc]

     I'm not sure how one would write such a bill, unfortunately. Perhaps say that we are counting all state spending & revenue as part of the region's spending & revenue for accountability purposes?

Basically, though we would want to specify which portions from the state ledgers are being combined and which are being dropped.

     I think we're only dropping the corporate tax portions. Should we drop state income taxes as well for the sake of simplicity?

That's what I was thinking.

[Yelnoc]

That looks good to me.  I would appreciate it if this was the first bill considered by the legislature once a new speaker is selected.

[Yelnoc]

Just as a reminder, we are going to have to calculate for Puerto Rico before we complete the combination.