Free Markets, Free People


Beware – revenue hungry Leviathan

Keeping with the previous post’s theme, and noting we’ve made the claim in earlier posts that government’s at all levels are revenue hungry (they want to maintain the size of the ravenous beast they’ve developed over the years and they want to do it with your money), this should come as no surprise to anyone:

Between her blog and infrequent contributions to ehow.com, over the last few years she says she’s made about $50. To [Marilyn] Bess, her website is a hobby. To the city of Philadelphia, it’s a potential moneymaker, and the city wants its cut. In May, the city sent Bess a letter demanding that she pay $300, the price of a business privilege license.

“The real kick in the pants is that I don’t even have a full-time job, so for the city to tell me to pony up $300 for a business privilege license, pay wage tax, business privilege tax, net profits tax on a handful of money is outrageous,” Bess says.

I have no idea what Bess blogs about, but unless it is specifically set up to generate income I don’t see any justification for the tax/license. I do see a possibility of a First Amendment issue.

Certainly a blog that generates $50 has an income of sorts. And if, as the story mentions, it was "dutifully reported", then she probably paid whatever taxes were due during that dutiful reporting.

But, as Leviathan loves to do, government just decided to invent a new category of "fees" and licensing (to avoid the tax word) to suck up more revenue. And, most likely, recognizing that most blogs don’t make much revenue they opted for a licensing fee. For instance, if you’re government, which would you rather have from almost 99% of the blogs out there, 5% of their revenue generated or $300?

So, given the nature of blogging and the fact that it has democratized social commentary, could a $300 bogus "licensing" fee be considered a bar to entry? And doesn’t that have First Amendment implications concerning free speech?

You have to love the irony of the license name. A "privilege license". Government, for a measly $300 will allow you the privilege of putting your opinion on line.

Really? I thought that was what the First Amendment – incorporated over all the states – guaranteed without impediment by government. Did I somehow misunderstand the intent?

But the city of Philadelphia – once the seat of freedom – sees it differently:

Even though small-time bloggers aren’t exactly raking in the dough, the city requires privilege licenses for any business engaged in any "activity for profit," says tax attorney Michael Mandale of Center City law firm Mandale Kaufmann. This applies "whether or not they earned a profit during the preceding year," he adds.

So even if your blog collects a handful of hits a day, as long as there’s the potential for it to be lucrative — and, as Mandale points out, most hosting sites set aside space for bloggers to sell advertising — the city thinks you should cut it a check. According to Andrea Mannino of the Philadelphia Department of Revenue, in fact, simply choosing the option to make money from ads — regardless of how much or little money is actually generated — qualifies a blog as a business. The same rules apply to freelance writers.

Essentially, what this will do is have those who wish to blog without interference or “licensing” by government drop any advertising they might presently carry – even the $11 one other blogger the story highlights made in a year.  I.e bloggers will be forced to drop advertising to avoid the fee.  99% will.  Of the possible 1% that make more than the $300 fee, my guess is most will attempt to find a way to claim, legally, that their blog isn’t located in Philadelphia proper.  I’m not sure what you’d need to do to do that, but I’d guess it is possible (have a silent blogging partner who “owns” the blog and is resident in some other part of the country, I suppose).

But, this is government.  This is what it does.  Government, with the economic downturn, is on steroids.  And as it searches for more and more revenue to support itself, it will intrude into your life and on your freedoms more deeply every day. 

A jackal can’t help but act like a jackal – especially when it is hungry.

~McQ

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8 Responses to Beware – revenue hungry Leviathan

  • So, anybody with a brain will not identify themselves as Philly bloggers.  They will be the bloggers formerly known as being from Philly.  How’re the revenuers gonna know…???

  • What I really hate about these incidents is the deeper implications behind them.

    This one will, most likely, be amended in the face of bad publicity. Which simply means that those who wish to lord over us have one more marker of exactly how far they can go and what they can get away with – this year.

    They can’t help pushing the limits of what we will put up with. They keep expanding power and grabbing more money until they are firmly opposed. Considerations of what’s legal, appropriate, ethical, good for their city economy, etc. are all completely beside the point. It’s what they can get away with.

    For the leftists out there, I’m telling you: if the left cannot find a way to restrain its lust for power, this will end badly for this country. Our implied social compact does not include your ability to forever keep testing the limits on the power you can grab just because you think you are smarter and better able to decide than the rest of us. 

    And since I’m pretty sure that 99% of leftists are congenitally unable to do so, we might as well start preparing for a bad end.

  • “Government, for a measly $300 will allow you the privilege of putting your opinion on line. ”

    Not quite.
    For $300 they’ll let you do it and have ad revenue or a tip jar.
    A blog with neither, they’re not trying to claim is a “business”.
    Which is also why the First Amendment issue is not perfectly clear-cut – since you can easily express yourself on a blog with no income, it’s not much of a restraint on expression… and if you are using your expression as a money-maker, it’s perfectly fair to treat it as being a business.
    (Just as any subscription-based outlet or a newspaper is plainly a business and can’t get out of paying taxes or getting a business license simply because it is also an instrument of expression…)
    The only really rankling thing here is the idea of a $300 permit and the rest for a trifle of income over a few years, rather than applying it only to actual businesses. If the permits had a bottom limit of, say, over $2000 a year in net income before being required, there wouldn’t be much of an issue, would there?
     

    • Sigivald[S]ince you can easily express yourself on a blog with no income, it’s not much of a restraint on expression…

      A good point.  I suggest that the real outrage here is not so much the gubbmint taxing blogs (which, it seems to me, COULD be used to stifle free speech by simply raising the tax to prohibitive levels), but that the gubbmint is going after such tiny amounts of money.  “You’ve got MONEY!  WE WANT OUR CUT!!!!”

      What’s next?  Taxing spare change jars?  The coins under the cushions in our couches?

    • Here’s the deal, I don’t charge people to read what I post. I pay about 10 dollars each month for a web host to host my site and I have my say. I blog on my dime and anybody who wants to read me is free to do so. It would be nice to get donations, but that remains entirely voluntary. In short, I’m not running a business of any sort, only expressing my view.
      What Philadeliphia is trying to do is repress free expression under the guise of enforcing business codes, and that is in violation of the 1st amendment.

  • Guys, please take note:
    …This applies “whether or not they earned a profit during the preceding year,” he adds.
    So even if your blog collects a handful of hits a day, as long as there’s the potential for it to be lucrative — and, as Mandale points out, most hosting sites set aside space for bloggers to sell advertising — the city thinks you should cut it a check
    .
    ‘As long as there’s the POTENTIAL’.  Anyone want to bet that wouldn’t be interpreted as “You may not have made a profit but the POTENTIAL is there, so you have to buy a license”?