Friday, February 20, 2009

Tax Me More, I'll Spend Less

The State of California finally passed a budget full of tax increases. No need for me to panic or spend my life's energy caught up in a debate that I am powerless to solve or erase. However, I have choices in how I behave with my own money: Frugal people like me will likely spend less or utilize more ways to pay for items out of state and have them shipped to us.

Our new budget will raise the sales tax which will motivate me to buy fewer and fewer unnecessary items, sticking ony to the necessities. Already, I cook most of my meals at home and eat out about twice a month. I don't take big vacations any more, so all of the taxes that slip in to vacate don't apply to me. (Plus, there are lots of less taxing options for travel such as trips to state/national parks, monuments, and venues. Luckily, they did not raise taxes on gas, which almost happened.)
I rarely pay for big ticket entertainment like I did many years ago, so extra spending that revolves around parking, souvenirs, snacks, etc. will not fall on me. Still, the best way to avoid sales taxes is to not buy taxable goods and services. Then, they can continue to blame the economy on people who won't spend. Yikes! A co-worker recently told me living like this isn't fun. To me, it's more fun choosing a meaningful lifestyle that doesn't revolve around spending money - which remains an unnatural, inorganic way to live.

Personal income tax increases will motivate me to increase tax sheltering options or make less money and stay at home. Hmmmmm, contrarian thinking. The less I can live on, the less I need to work, the less in personal taxes I will have to pay. I can enjoy more of what money can't buy and I highly value free time to creatively do whatever I want to do which, as of now, can't be taxed!

If a person has a lot of debt or lives a highly consumeristic lifestyle, furlough days and pay cuts are extremely frightening. While I don't like pay cuts, I see this recession as an opportunity to rethink and tune up what I value most and it's still freedom. So, what else can I cut back on in the weeks to come so that I won't have to pay more taxes? What else do I need to let go of so that I can spend more time at home or in tax-free community with others? I refuse to waste my energy working up a sweat about what politicians are imposing on me. Since I am a native Californian with no intentions of moving to another state - at least not yet, this is my best personal response: change my own behavior and work around their humpty-dumpty system. It's challenging. It's uncomfortable. It's empowering! Freedom!

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