Backdoor Taxes

I just paid my City of Memphis property tax bill and as usual I waited until the last minutes to drop it into the post box. Also as usual I was and still am in a bad mood.

I think I am paying way too much as the house next to me was sold at a price well below the appraised value of my house. There is a house on the next street up for auction. I recently read the great news that Memphis leads the nation in housing auction bargains.

Recently I got to thinking about fees (read taxes) that are over and above my property taxes. I am sure I will miss some but here are a few that come to mind.

  • Sewer charge (on the back of your MLGW bill). $63 million
  • Solid waste fee (on the back of your MLGW bill). $52.4 million
  • Mosquito/Rodent Control Fee (on the back of your MLGW bill). $3.6 million
  • Storm water fee (on the back of your MLGW bill). $21.9 million
  • Motor vehicle license fee wheel tax. $29 million.
  • City, school board, hospital, crematory, police stations, etc., to be furnished water free of charge and estimated to be $2.3 million dollars.

 

Then I got to thinking about “in lieu of tax” charges. The MLGW paid to the City of Memphis in 2009 $52.6 million dollars as if it were a private business enterprise which it is not.  If it were a private business, then I could understand this property tax charge. Since the MLGW is owned by the City of Memphis, this is another property tax paid through your utility bill. Then there is an in lieu of tax fee of $4 million in the enterprise sewer fund that is collected through your sewer charge. On top of all this are the hundreds of millions of dollars paid by the MLGW to fund their OPEB (other post employment benefits, mainly health care) the funds for which are lumped into your light gas and water charges. The City of Memphis has not figured out how to backdoor you for taxes for their huge OPEB unfunded liability which is over $900 million dollars. They are still trying to figure out how to come up with $57 million for the school system.

These backdoor taxes total up to 228.8 million dollars that you pay over and above your City of Memphis property tax bill. Front door taxes include sales taxes (9.25%), federal and state income taxes (Halls tax). At the federal level they are thinking about a European style VAT tax (value added tax). Let me know if there are other backdoor taxes that I have missed.

2 Responses to “Backdoor Taxes”

  1. david says:

    Yes, raising property taxes through reappraisals, the largest backdoor approach. Mine went up 25% on last reappraisal, in the worst property recession since the 1930s.

  2. Yes, raising property taxes through reappraisals, the largest backdoor approach. Mine went up 25% on last reappraisal, in the worst property recession since the 1930s.
    +1

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