Only in Oakland?

This article from Oakland's East Bay Express is a classic illustration of what you get when you live in a left wing city that's hurting for money. They come up with fiendish new tax schemes and tyrannical restrictions on businesses. Apparently, some genius in the Oakland bureaucracy figured out that it would be legal to apply laws originally designed to tax and regulate pawn shops to other businesses that deal in used goods.

Small Oakland retailers, already suffering because of the recession and the proliferation of Internet shopping, are angry about the City of Oakland's decision to begin collecting a hefty new business tax. The fees could amount to more than $600 per business and apply to sellers of used goods -- such as used book, clothing, record, and toy stores, and antique shops. The city has sent letters to dozens of such retailers across Oakland, demanding that they pay the tax and force their employees to be fingerprinted, or face additional penalties.

But the city's demand is sparking a revolt -- not unlike the backlash over the council's decision this summer to raise parking meter rates and extend hours to 8 p.m. One retailer said she does not intend to pay the tax. "I don't think this should apply to our business," said Amy Thomas, owner of Pendragon Books, a bookstore on College Avenue in Rockridge that sells new and used books. Thomas, who also owns Pegasus Books in Berkeley, said that the City of Berkeley has never attempted to implement such a tax. Nor has the City of Alameda.

Traditionally, the tax has applied only to pawnbrokers. It's based on the state's Secondhand Dealers' law, a 50-year-old statute written to help law enforcement track stolen goods. Historically, cities, which collect the tax and can keep most of its proceeds, have exempted businesses not usually associated with the stolen-goods trade -- such as used bookstores and antique stores. Pawnshops, by contrast, have had to pay the tax.

But in the past few years, several cities have begun imposing the tax on other businesses, too, said Carl Brakensiek of the California Alliance of Resale Merchants and Collectors, a statewide trade group that has followed the issue. As the economic downturn has bludgeoned city budgets, local officials have desperately searched for ways to raise revenues. "Some municipalities are doing this while others have chosen not to," Brakensiek said of the tax.

In Oakland, however, sudden implementation of the tax does not appear related to a search for new revenues. Instead, employees apparently took it upon themselves to launch the program. Nancy Marcus, whose title is "administrative assistant 1 for special events permits," said that two new employees had discovered that Oakland could legally require many retailers to apply for license like pawnbrokers, and then begin collecting the fees.

So in an August 13 letter that Marcus said she sent to 48 Oakland retailers, she told business owners they had to pay $310 for an application fee, $195 for a state license fee, and $57 to $67 to fingerprint each employee. Businesses must pay annual fees in succeeding years. Marcus gave business owners a deadline of September 10 to comply. Under state law, once a business acquires a secondhand dealers' license, they must keep meticulous, detailed notes of every item they buy and sell, including the private personal information of the persons involved in each transaction. Failure to comply with the law is considered a misdemeanor that carries a fine of up to $1,500 or two months in county jail.

The kicker is that they could law apply the law to almost anyone:
under a liberal reading of the law, there is no reason it shouldn't also apply to garage sales.
Or Ebay sellers, for that matter.

It's easy to laugh at Oakland because it is such a left-wing city, but if you think ideas like that don't spread, think again. City bureaucrats attend conventions and share ideas, and many a goofy idea we all laughed at (like bans on smoking, trans fats, and dog testicles) started in nutty left wing cities and towns, and eventually ended up being de rigueur everywhere. After all, these things are called "progressive."

Besides, as we all know, only mean-spirited bigots mind paying their taxes!

(You know, like Geithner, Rangel, ACORN....)

posted by Eric on 09.22.09 at 08:16 PM


Liberals and socialists do not seem to understand that if taxes are too high business will shut down or move giving them zero revenue.
The same applies to taxing wealth, wealth can and will relocate.

Hugh   ·  September 23, 2009 9:18 AM

There does seem to be attacks on selling used articles such as at garage sales nationwide. Recently there was a bill passed here, Illinois, concerning selling previously recalled items, kiddie items must have no lead signs, and having to pay sales tax and keep records, etc.
Just another restriction on personal freedom? I don't know.

Jim G   ·  September 23, 2009 1:58 PM

What usually happens is these municipalities and states that place punitive taxes or other burdens on businesses and property owners experience substantial emigration. Their next step is to loudly claim the places attracting emigrants are "stealing" from them, or "competing unfairly."

Odd how "fairness" always requires coercive action from government.

Steve Skubinna   ·  September 23, 2009 2:00 PM

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