The New York Department of Taxation recently mandated that all state sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. returns be filed electronically. Reasonable, right? Not for the Amish communities of the Upstate. The conservative sect rejects modern conveniences such as electricity, motorized transportation, and photo identification, and their beliefs are largely respected by government programs. The group is exempted from the Social Security and Medicaid systems, for example. Leave it to state taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. administrators to upset their delicate coexistence.
Under the new regulation, those without internet access can call to request special permission to continue to file on paper, but many Amish never learned of the new requirements. The state made no special effort to inform the group or facilitate exemptions. Many Amish businessmen have now started to receive letters stating that they will be charged $50 for each paper return.
According to a tax department spokesperson, the “expectation was that businesses with concerns about complying would call the Taxpayer Contact Center.” But beyond never learning of the regulation, most Amish will not touch a phone.
When furniture maker Jonas Hershberger mailed in his $50 of sales tax collections, he received a request that he comply with e-filing regulations. After an exchange of letters the state didn’t budge. Hearing the story, State Senator Patricia Ritchie intervened. When the tax department “finally listened to what she [the senator] was trying to tell them, they offered to call him.” Call him?
This tax administration policy shift is largely a violation of the principles of simplicity and transparency. The state is imposing giant compliance burdens on a select few and threatening inequitable fines. The state could have made efforts to inform those who would be most affected by the policy change, and help this group through the transition. If even the gargantuan Social Security Administration can make special considerations for a protected religious sect, state tax authorities could do the same. After all, these people are not trying to evade their tax liabilities.
It is odd that the tax department is alienating a group that is so willfully compliant, just for the small cost of paper processing. How many other Americans would voluntarily file a $50 sales tax return that is virtually un-auditable?Share