Sunday, August 22, 2010

Why the government of Philadelphia is made of fail

Not only would the mayor & Co. like to trash the 2nd, they do crap like this:
For the past three years, Marilyn Bess has operated MS Philly Organic, a small, low-traffic blog that features occasional posts about green living, out of her Manayunk home. Between her blog and infrequent contributions to, over the last few years she says she’s made about $50. To 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.
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.
Isn't that just freakin' wonderful? Let's ignore any actual amount of money earned and take a long, hard look at that line again: as long as there's the potential for it to be lucrative they think they should be able to tax you. They've got this set up so even if you don't have ads they can claim there's the 'potential' for profit and that's their excuse for demanding you get a license.

Which leads me to wondering when they'll start trying to use this to shut down blogs that say things they don't like("Hey, we're all for free speech, but this blog didn't buy the business license, so we HAD to shut it down.")?

And this counts as 'helping solve the problem':
In June, City Council members Bill Green and Maria Quiñones-Sánchez unveiled a proposal to reform the city's business privilege tax in an effort to make Philly a more attractive place for small businesses. If their bill passes, bloggers will still have to get a privilege license if their sites are designed to make money(And remember that bit above about ad space and 'potential'), but they would no longer have to pay taxes on their first $100,000 in profit. (If bloggers don't want to fork over $300 for a lifetime license, Green suggests they take the city's $50-a-year plan.)

Their bill will be officially introduced in September. "There's a lot of support and interest in this idea," Green says
There ought to be a lot of support and interest in borrowing a roofing tar trailer and buying a bunch of pillows and visiting City Hall.

1 comment:

Sailorcurt said...

Of course, the up side is, if it's a business, you can claim the costs of running it as a business expense on your taxes.

Sure, you have to pay for the business license, but that is a business expense, as well as the web site hosting, your computer, office space, and anything else you can think of that's related to posting content.

So, there's a couple of thousand dollars a year you can claim on taxes as business expenses, minus the ten or twenty bucks you might garner from ad revenue.

Someone better at tax law would have to do the heavy work, but it could work out to be a net positive.

I wonder how long it would be before the state started figuring out that, at the gain to the city of a $300 business license, they are losing out on several hundred dollars (or more) of income taxes every year?

Might get interesting.