Tax Me More

Some states are making it easier for taxpayers to donate a little extra money.
by | June 2003

It's a question not heard much in general discourse: "Hey, do you know how I can pay more taxes than I have to?" And yet, some policy makers believe that with a little encouragement citizens might fork over more money to the government than they owe. Noting that some constituents have said they'd be willing to increase their tax burden to help out in a budget crunch, legislators and governors in a handful of states are working on ways to make it easy for citizens to do just that.

However, in jurisdictions that have implemented "tax me more" programs, the response has been lackluster. That's not to say money hasn't come in. The fund in Arkansas, established in November 2001, has already hit $2,033.77 and is clearly well on its way to reaching $2,034. Donations are erratic, but they've been dribbling in not only from Arkansans but also from as far away as California, Maryland, Massachusetts, New York, Ohio and Pennsylvania. "It seems like we'll get a donation if someone reads about it," says Roberta Overman, manager of the sales section of the Department of Finance and Administration.

At the time the fund was started, Governor Mike Huckabee didn't feel that tax increases were necessary, according to spokesman Rex Nelson. Setting up the tax fund was the governor's way of saying, "Here's a voluntary account if you're willing to pay more." It was not done with the idea that scads of money would come pouring in. "It was done with the full expectation that the result would be exactly what it's been," says Nelson.

The smallest donation has been one penny. Sometimes the department gets checks, other times coins are taped to pieces of paper and mailed in. A letter that accompanied one two-cent donation mentioned that the benefactor "wanted to give us his two cents' worth," recalls Overman. But Arkansas also has received checks for $50 and $100.

The National Taxpayers Union, a nonpartisan taxpayer watchdog group, is not surprised at the meager response. "The reason why they tend to exist is to serve as a wake-up call for lawmakers who still believe people might actually be willing to pay a lot of money to address budget deficits," says spokesman Pete Sepp. "The silence in response to these funds has been deafening."

But that hasn't stopped some lawmakers from pushing for similar programs. Virginia state Senator Nick Rerras says he heard from people during the legislative session last year who favored additional taxes. Virginia has been phasing out a hefty car tax and a lot of residents are critical of the loss of revenue. The thinking behind a "tax me more" bill was if people felt strongly that the state needed more taxes, the legislature could create a mechanism to make it easier for them to contribute. And so it did. Since then, about $400 has trickled into the commonwealth's coffers.

Although people have always been able to augment a state's general fund, in Wisconsin, a measure sponsored by state Senator Tom Reynolds would create a better accounting mechanism and increase public awareness that they can contribute. "I don't think people necessarily know they can make an extra donation," says Steve Krieser, Reynolds' chief of staff. "We're sincerely hopeful that folks interested in preserving a particular program would use the mechanism we're providing in the bill to make an additional donation."

State Senator Bob Jauch, who opposes the idea, told a Wisconsin newspaper reporter that it was selfish, promoted by people who didn't want to pay more taxes but would be happy to have others do so. Jauch is one of the few Wisconsin legislators who favor a tax increase and called the voluntary program, "a silly idea by people who have very little respect for the citizens of this state."