Shame Them Into Paying Taxes?

A couple of New York State legislators think they've got a plan to get people to pay their taxes. They want to publish the names of tax scofflaws online.

That's the call from two state legislators who want to post names of tax scofflaws online to shame them into paying.

"These individuals are not playing by the rules," said state Sen. Jeff Klein (D-Bronx, Westchester), who has introduced a "cyber-shame" bill in the Senate.

"They're not paying their taxes, and hardworking people around the state of New York who are doing the right thing ...are getting hurt as a result."

Among the state's worst deadbeats are a phone card company that owes more than $15 million, a Manhattan outfit that runs luxury yacht tours and owes $1.8 million, and the high-end Cipriani restaurants, whose father and son owners have pleaded guilty to tax fraud, Klein said.

It all adds up to $2.5 billion in unpaid taxes, Klein said.

"This is really a question of fairness," said Assemblyman William Colton (D-Brooklyn), who has introduced similar legislation in Albany. "Many services are in danger of not being able to be funded ...And yet there are some people who have flagrantly refused to pay their fair share of taxes."

Klein and Colton also are calling for a temporary tax amnesty where deadbeats who agree to pay the bulk of their bills can get interest and penalties waived.

Based on the success of deadbeat crackdowns in other states and of past amnesties in New York, the lawmakers estimated these efforts could raise $250 million.

I'm not sure that would get the job done. A far more effective measure is to get the tax cheat to be nominated and/or confirmed for higher office, such as Tim Geithner for Treasury Secretary or Tom Daschle, Hilda Solis, or any number of other nominees proffered by the Obama Administration who turned out to be tax deadbeats and who paid up their tax obligations only after being on Obama's short list for nominations.

States have been bolstering their tax enforcement divisions because of declining tax revenues, and New York is among those states that are in dire financial shape. They need every last penny to come in, and they are pinning their hopes on going after the tax cheats.

Besides, states already publish tax scofflaws. Take the case for California. They regularly publish a list of tax delinquents, and yet the state has a multibillion dollar deficit and is sliding towards bankruptcy because of out-of-control spending.

It doesn't seem to help enforcement. Making the tax obligations easier to pay might. Reducing the tax burden would help as well. Publication wont hurt, but it certainly wont help to the degree that these legislators think.