ANNAPOLIS – Consumers and store owners staged a take-off on the Boston Tea Party Thursday to protest bills allowing localities to increase the sales tax on home video rentals to 10 percent.
Billed as the “Maryland Tape Party,” the event drew a small crowd of press and onlookers to the City Dock as organizers tossed a net filled with videotape cases off the side of the pier.
It took four men to lower the tape-laden net, which was immediately removed from the water.
Speaking against a backdrop of clear blue skies and wind- whipped water, Stephen Schwartz told the crowd that Marylanders rent 48 million videotapes each year.
These rentals already generate $6 million in sales tax, said Schwartz, a representative of the Video Retailers Association, a 13-year-old national group with 500 members in Maryland.
Schwartz said the bills amount to taxation without representation, and charged that lawmakers acted in secret.
“I didn’t even know about these bills until about five weeks ago,” Schwartz said. “The consumers didn’t know. The newspapers didn’t know.”
Schwartz’ comments were echoed by a video store owner from Washington county. “We feel the tax is being slid across the table and no one knows about it,” said Ken Trenary, owner of Family Video in Williamsport.
But Sen. Barbara Hoffman, D-Baltimore, sponsor of the Senate bill, disputed the charges of secrecy, saying that the current bill is similar to one that failed to pass last year. She also noted that the bill had a public hearing in February.
The measures, called the Admission and Amusement Tax bill in both the Senate and the House, would allow municipalities to impose a tax on videotape and game cartridge rentals. Any new tax, when added to the 5 percent Maryland sales tax, cannot exceed ten percent of the cost of the rental.
The legislation was requested by the Maryland Municipal League. The bills could reduce municipalities’ need to increase property taxes, their main source of income, the group’s associate director said during a telephone interview.
“People don’t like to pay taxes, but government services have to be paid for in some way,” said Steve McHenry. “Ten or 15 cents on a video isn’t going to kill anyone.”
But opponents argue that even a minimal increase in the cost of videotape rentals could adversely effect frequent customers who rent more than one video at a time.
Tom Giannini, of Cockeysville, told the protesters that he and his wife rent five to 10 videos per week because it is less expensive than going to the movies.
Calling the bills “very regressive,” Giannini said they would have a greater effect on low-income families, many of whom use video rental as their main source of entertainment. The Senate bill was recommended for passage by the Budget and Taxation Committee and is awaiting a final floor vote. The House version is awaiting a vote by the Ways and Means Committee. -30-