OcTaxLaw.com

Oakland, California (location of Oaksterdam) is attempting to get more tax revenue from medical marijuana, this time focusing on growers:

After becoming the first U.S. city to impose a special tax on medical marijuana dispensaries, Oakland soon could become the first to sanction and tax commercial pot growing operations. Selling and growing marijuana remain illegal under federal law.

Two City Council members are preparing legislation, expected to be introduced next month, that would allow at least three industrial-scale growing operations.

One of the authors, Councilman Larry Reid, said the proposal is more of an effort to bring in money than an endorsement of legalizing marijuana use – although the council has unanimously supported that, too.

The city is facing a $42 million budget shortfall. The tax voters approved last summer on the four medical marijuana clubs allowed under Oakland law is expected to contribute $1 million to its coffers in the first year, Reid said. A tax on growers’ sales to the clubs could bring in substantially more, he said.

More marijuana taxation here.

Many people are looking for new sources of income in these times of economic uncertainty, and they certainly do not want to them lose a chunk of it to the Inland Revenue. If you have a spare bedroom, it could be a great asset. Letting a spare room or taking in a lodger can literally be money for nothing. If you declare the income under the rent-a-room scheme, it is completely tax-free too.

What are the Rules for a Rent-a-Room Scheme?

There are a few rules and conditions. The room or rooms must be let furnished and it must be your family home the place where you actually live. This tax-free benefit does not apply if you have split your home into flats or if you own the house but live elsewhere.

How Much Can I Earn Tax-Free?

If you have more than one spare room, you can take in more than one lodger. The rent-a-room scheme income is capped for 2009-10 at 4,250 a year tax-free, which is just over 81 per week. Anything more than this will be taxable, but if it is your only income, it can be offset against part of your annual allowance.

I Dont Own My Home, I am a Tenant. Can I Still Use this Scheme?

Yes, if you rent the house yourself and then sub-let rooms to others then you can still take advantage of the Rent-a-Room scheme. However, you need to check that your lease allows you to take a lodger.

Are There Any Disadvantages to the Scheme?

The difference between a normal let and using the rent-a-room scheme is that with this scheme you cannot deduct any expenses for wear and tear, insurance, electricity bills etc. You have to declare all the income received, and if it exceeds the allowance, it is taxable.

Do I Need to Notify the Tax Office?

If you do not normally receive a tax return and your income is below the threshold for the scheme, you do not need to do anything.

If your income exceeds the tax-free threshold you need to tell your local tax office. When you complete your tax return, declare the income for renting the room in the relevant space in the property section, or tell you tax adviser when they complete your return for you

Related Articles:

• Inland Revenue tax returns for property landlords
• Tax return for rental property
• Self assessment tax return 2009-2010

You should seek the advice of a trained professional for your indivdual circumstances. None of the above can be taken as advice, it is mearly informal.

Capital gains tax will not raise extra money, economists say – Telegraph.

The Telegraph reports:

Soda taxes are out in Philadelphia, but tobacco taxes are in:

Real estate taxes, commercial trash fees and the cost of tobacco and related products will all go up under a fiscal 2011 budget passed by Philadelphia City Council on Thursday.

But sugary beverages won’t be subject to a 2 cents-an-ounce tax. Mayor Michael Nutter, who supported the tax, said that the budget as passed will cause the city’s general fund to run dry in the upcoming fiscal year. To prevent that from happening, more than $20 million in additional cuts will have to be made, including the elimination of 339 positions, Nutter said.

…The budget also raises commercial trash fees from $150 to $300, which will generate about $7 million more annually. Blackwell, Green, Kelly, Krajewski, O’Neill and council member Frank DiCicco all voted against the trash increase.

The tobacco tax, which applies to loose leaf tobacco and cigars, might be set-up to fall short of revenue estimates for a couple of reasons.  First, optimistic revenue estimates allow the government to not cut spending (more than they have).  There can be an incentive for politicians to be overly optimistic forecasting tax revenue.  Also, while we raise the issue of state border shopping as a concern for stable tobacco tax revenue, the issue is especially present for a smaller bordered city.  It would make sense that border shopping—in order to escape higher taxed products—is a function of the cost of crossing the border and the price differential of the product in and outside of that border.

Other than that, tobacco taxes run into just as many as issues as soda taxes within the context of sound tax policy.  Discriminatory, paternalistic, and un-effective.

The first month of the new decade has already been and gone, and so has the first tax return deadline! Below are a list of some of our most popular articles of the month:

• Work visas and tax rebates
• Applying for an Income Tax Rebate
• How do I find out if I am due a Tax Rebate
• BR Tax Code
• Tax rebate – How do I apply for one?
• How do I get a tax refund?
• Tax refund eligibility
• Who needs to do a tax return?
• Tax rebate form online
• Am I entitled to a tax rebate?