Not only larger government … complex, too

I don’t much care for it for so many reasons, but even I’m becoming a little concerned about Virginia’s Republican Party. They’re clearly mental, as shown by this tax oddity from the General Assembly:

State senators in Virginia have come up with an unusual new tax increase. People who don’t like it don’t have to pay it.

But here’s the catch: They must be especially well organized.

The Senate, which hopes to raise about a billion dollars a year to spend on transportation, is seeking a 5 percent increase in the wholesale gas tax to help raise the revenue.

Even though the tax is on wholesalers, it could well be passed along to motorists as they pump their gas.

So many points pop out, but I’ll hit the most obvious. The tax could be passed along? What version of free-market economics states otherwise, other than the version politicians believe? Every penny of the tax would get passed along and the Senate knows this. Otherwise, what’s the point of having consumers being able to “opt-out” of the tax? Of course, when reading further into the details it becomes clear what’s really going on:

So under a bill that the Senate Finance Committee passed this week, they could get some money back. That is, they could get it back if they saved all those flimsy little gas purchase receipts littering their car floors and spilling from their glove compartments and sent them in to the state Department of Motor Vehicles.

Twice a year, motorists could ship off a bundle of receipts and, weeks later, receive a check in the mail representing a rebate of the new gasoline tax. Based on today’s gas price, the refund would amount to about 8 cents a gallon.

“No one would have to pay this tax if they didn’t want to,” said Sen. Kenneth W. Stolle (R-Virginia Beach), whom colleagues credit with coming up with the idea.

I can only imagine Sen. Stolle’s colleagues credit him with the idea because they don’t want it’s stink permeating their offices. More importantly, no state’s DMV is competent enough to handle processing driver’s license applications, much less a detailed, paper-trail heavy tax rebate program. It’ll do little more than create jobs for vindictive paper-pushers.

Obviously, though, the real purpose behind this tax plan is to generate revenue from those who won’t be bothered by potentially trivial savings recouped from an investment in record keeping and paperwork. I also doubt the program would be advertised too well if it passes. That would create rebate requests from those less likely to pay attention to the news. Much like product manufacturers and retailers who now offer rebates instead of sales, the state would be offering something it doesn’t want anyone to participate in. Of course, we can all be reasonably assured that “glitches” will never occur and everyone legitimately asking will get the appropriate refund. Uh-huh.

Did I mention that motorists aren’t eligible for gas purchased for business use of cars and trucks? That seems like a significant little exemption to the opt out provision.

Also, notice how conveniently similar this is to the concept of income tax refunds. Offer the government money throughout the year, at zero percent interest, and get exactly 100% of your tax refunded. In the best case scenario, the General Assembly is demanding an interest-free loan from motorists every time their car needs gas. Applaud this innovation only if you have no idea what the time value of money is and don’t care to learn.

The correct policy is not complicated: tax me honestly or tell me I can’t have what you think I want.