Posted on 02/06/2009 5:55:24 AM PST by JZelle
ANNAPOLIS, Md. -- Annapolis lawmakers are introducing a bill that would allow for the collection of money from unspent gift cards to put into the state treasury.
Nationally, gift cards are a $59 billion industry. Experts estimate that 6 percent of gift cards go unspent in Maryland. The bill would allow the state to claim 70 percent of that unused money and use the cash to fund education.
"To me, this is a no-brainer. If you haven't used your gift card for four years, you are not going to use it, and why can't we share? The bill states we keep 70 percent of it, and retailers keep 30 percent," said Delegate Joseline Pena-Melnyk, D-Anne Arundel and Prince George's counties.
Thirty-two states have a similar law. Some of them keep 100 percent of the unspent gift card money, 11 News reporter David Collins said. But state retailers, grocers and the hospitality industry oppose the measure.
"The money belongs to the person. It doesn't belong to the state. It is sort of an indirect taxation -- this bill. This was money that was given to somebody, and if they choose not to spend it in a certain time period, it's still their money," said lobbyist Bruce Bereano.
International consulting firm Towergroup noted in a report that retailers don't generate revenue from gift cards until they are used or declared dormant. However, the money used to purchase the cards generates interest for the business.
The report cited Best Buy as an example. It said the store moved $39 million from liability to income in 2005 due to unredeemed gift cards.
(Excerpt) Read more at wbaltv.com ...
Doesn't the 5th Amendment state clearly that private property cannot be taken for public use without just compensation?
The stores already track that. The state stealing the money is incredibly sleazy, but the accounting on these gift cards is pretty tight. I expect far more of this kind of creative theft from the government as revenues fall and the cost of giving everybody a new pony goes up. Also expect your property values to go up on the tax roles even though the actual value is dropping, sudden *cough*cough* studies that show 380 people and two puppies die for every person that doesn't wear a seat belt, requiring significantly higher fines and enhanced enforcement of seat belt laws. There will be a booming business in red light cameras, and cigarettes will become more expensive as new studies show that cigarettes cause a person two blocks away from the smoker to explode.
Everything any legislature does is a no-brainer.
“All your giftcard are belong to us.”
The old “it goes to education trick”.
Why do people continue to fall for that crap?
So they steal $60million in gift cards, it goes into education - then another arm of the government octopus takes out $60million that education was getting from someplace else.
The Mayor of Baltimore Sheila Dixon has announced she will be glad to personally recycle all those unused gift cards back into the economy
Yeah it’s similar. I’m in a quandry about the 401Ks. I don’t want to take the penalties, nor pay the extra taxes, yet if they propose some takeover of them in exchange for a SS administered fund...I think we’ll have to cash in, bite the bullet and pay taxes and penalties...something is better than nothing. (We’re fortunate we haven’t lost any of our 401K fund because we moved it all into stable funds before the downturn, but for those who have lost money, plus then get the remainder taken over with only a 3% growth on investment, that really stinks.)
Yes and no. The store got its money, but in the form of unearned revenue, a liability, meaning they still owe someone product for the monetary value of the gift card. Essentially, the actual theft is from the consumer by the state.
demoncRats: The Party of Robbery.
Easy fix. Don’t buy or give gift cards. Spend the ones that you get immediately.
Is this true? If so, this is an outrage! I've never heard of this sort of tax (which is what it is) being imposed. I'm sorry, but our pols are all worthless at this point. They are simply crooks in nice suits.
Thought of that too.
I have a small mutual fund that I allow to just sit year after year...
They going to say I obviously don’t “need” it???
(They didn't pick me) “Instead, they put on [the slate] some young kid who worked at one time for the president of the Maryland Senate, and he was a well-connected Caucasian,” Peña-Melnyk recalled during an interview with USINFO. “So I had to run on my own.”
Also a member of the pro-illegal alien organization Casa de Maryland.
“If you haven’t used your gift card for four years, you are not going to use it, and why can’t we share? The bill states we keep 70 percent of it, and retailers keep 30 percent,” said Delegate Joseline Pena-Melnyk, D”
Because YOU didn’t earn it, you marxian ho!
I wonder what they’ll settle on, insofar as the length of time that constitutes “unused.” This type of crap is what makes the Peoples’ Republic of Maryland so special.
This is un-freakin’ believable ... AND I live in MD!!!
The MD legislature might as well go to the grocery stores and demand the wallets of ALL the customers ...
Like, I get a unexpirable $100 gift card, don’t use it for a while, then go to use it and its ONLY worth $30???
Robbery - pure and simple ...
HOWEVER, I shouldn’t be surprised ... this from the folks that brought me the awarding of ALL my state’s electoral votes to the winner of the national popular vote (regardless of how my state voted).
Fortunately, THAT law will NOT go into effect UNLESS enough states (with 270 cumulative electoral votes) do the same.
Sheesh ...
Sheesh! It’s like they’re daring people to revolt!
I think they call this ..Uhhh....Umm ...STEALING ?
Now, some companies write down the balance over time, and depending on the terms of the card, may reduce the balance available to you over time as well. As they do this, they write down the liability on the card. Some stores are no longer honoring their gift cards. Either way, the money belongs legally to the consumer or retailer, depending on the terms of the card.
Gift cards are a joke, really. The only reason I buy and use them is to buy music on line from Walmart without having to use my debit card all the time.
The best thing for Aunt Flo to do is send Little Johnny the ultimate go-anywhere gift card, cash.
I have to also correct my statement, many states may require the recongnition of gift cards sales as revenue for tax purposes. Either way, the state should have no right to the remaining balance.
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