Monday, November 01, 2004

Stadium Tax Revision

The Washington Times reported that the Business tax for stadium construction is under revision.
The structure currently offered by Mayor Anthony A. Williams and top aides calls for District businesses grossing at least $3 million a year to pay a fee ranging from $3,000 to $28,200 a year. Businesses generating at least $16 million a year would pay the top-end fee.
But after hearing from hundreds of citizens and trade groups, many council members and administration officials believe it is not proper to assess the same fee to one business grossing $16 million a year and another grossing 10 or 20 times as much.
In the changes, which are still under discussion, businesses grossing more than $20 million might be split into one or two new categories on the fee scale, with the top-end tax perhaps surpassing $40,000 a year. City officials estimate about 280 businesses in the District meet this high-end threshold. The tax as currently written would apply to 11 percent of city businesses.

This seems like a slightly more fair way of doing it. High revenues does not always equal large profits. It really depends on what kind of margin the business has. And capping the payment amount gives an unfair burden to those at the lower end of the revenue scale.

In a semi-related article, Eric Fisher talks about what would happen if the stadium bill were to fail. It wouldn't be good for DC.