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Sunday, July 2, 2017

PA Vaping Taxes: A Short Story...

As you may or may not know Pennsylvania requires a balanced budget (revenue in must equal revenue out).

At its peek a vape shop I know was paying many tens of thousands of dollars in sales tax, use tax, wage tax, and local taxes every year and employed many people who, living in Pennsylvania, paid even more state and local taxes.

After the 40% vape tax enacted last year to cover last years PA "budget shortfall" the vape shop tax bill is now down to perhaps a thousand or two.  Thousands in inventory were donated for tax credits to save on the 40%, staff was cut, doors closed.

The net effect was that the vape shop owners have vast federal tax credits and PA has literally nothing to show revenue-wise for their stupidity and greed.

There will be more smokers and hence more health care expenses from the state's general fund.

I was sitting in a bar the other day.  The guy next to me used to own a bar.  He told me he never had any employees, a fact that state of Pennsylvania did not like.

They threatened him.

His response: "I'll put my wife on the payroll for half the year and lay her off for the rest.  The net effect will be Pennsylvania will lose money."

They left him alone after that...  (or so he said).

The moral of the story: You get less of what you tax.

The behavior of the legislators is reminiscent of opiate drug users.  As the addiction to the drug grows (cash in this case) the behavior becomes more and more irrational and dangerous in order to fill the addiction.

Sadly most shop owners don't get it.  They are not dealing with rational people (their legislators).

As a shop owner you should expect irrational behavior like you'd see from an opiate addict.

(More on this here:

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