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Arlington County Board Gives Lesson in Income Redistribution

When the Board voted at their March 17 meeting (item 21.J.) to advertise tax rates and fees, they voted to approve a residential utility tax not to exceed $1.10 per month on both electricity and natural gas. While Arlington had charged a commercial utility tax since 1989, it was the only Northern Virginia jurisdiction to not impose a residential utility tax. At the meeting, one Board member objected to the tax on the basis that it was a regressive tax.

Although the Board approved the FY 2008 budget, and taxes to pay for it, on April 21, they deferred approving the residential utility tax until today's meeting (agenda item 26). According to the press release, “The tax excludes a certain level of utility usage from taxation and caps the maximum tax that will be paid per month for electricity and natural gas at $3 dollars for each.”

The following three points, taken from the press release, provide lessons in both income redistribution and social engineering:

  1. “I am pleased to see the County create a permanent source of funding for environmental sustainability,” said County Board Chairman Paul Ferguson. “This is a modest tax, structured in such a way that it encourages residents to conserve energy. Still, this tax will cost no household more than $72 a year for electricity and natural gas combined, and many residents will pay no tax at all.”
  2. “Approximately half of all homes will pay no utility tax in a given month due to the excluded thresholds. The tax burden will fall on the heavier users of electricity and natural gas utilities. Homes able to reduce their energy consumption modestly will save more than the amount of the tax. Based on current electric and natural gas prices, residents can substantially offset the residential utility tax amount by installing compact fluorescent light bulbs or insulating their gas water heater.”
  3. “Arlington is the only jurisdiction that excludes the first 400kWh of electricity usage and the first 20 CCF of natural gas usage from taxation. This methodology is designed to impose a tax on the heavy users of our natural resources and to provide a funding source to affect a change in the community and reduce the environmental impact of carbon dioxide in the environment.”

Although the Board boasts that they avoided raising the real estate tax rate, the residential utility tax was one of several so-called "revenue enhancers" that they approved. And although the real estate tax rate wasn't increased, because of increased commercial assessments, the effective increase in real estate taxes was 4.6%.

It must all be good, though, since it’s done in the name of environmentalism and on behalf of global warming. Talk about the political elite knowing what’s good for us? Sheesh!

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