Tax yoga in Washington, D.C.? Over our savasanas, yogis say

For a second time, city leaders in the U.S. capitol are trying to squeeze a little more tax money out of some of the city’s fittest workers.

That’s the gist of a proposal to tax yoga studios and gyms, along with other “service providers” — i.e. barbers and hair salons, bowling alleys and car washes.

The yoga community there, apparently, isn’t taking it in savasana. Here’s the Washington City Paper’s coverage:

In 2010, then-Mayor Adrian Fenty proposed a similar tax on gym services, and hundreds of people rallied against the tax. The tax didn’t survive.

Will this one? The industries involved aren’t any happier about the proposed tax four years later. Vida Fitness announced that it plans to lobby against the proposal. It told people to contact their councilmembers to say they oppose it. There’s a #nodcyogatax Twitter hashtag going around, a Facebook group, and a petition on Change.org urging the Council to kill the tax.

On June 3, there’s a planned flash mob, in which participants will form a “burpee fence” around the Wilson Building and drop and do eight burpees for the city’s eight wards, says Graham King, the owner of Roam Fitness who started the Facebook group, in a post on its page.

I’ve been involved, in California, in discussions about changes to the tax code. Like most issues, it isn’t as simple as either side would want you to think. Services are an untaxed part of the economy, which — one can argue — is unfair to those businesses that have to pay taxes: manufacturers and sellers. I’ve heard people say that services shouldn’t be taxed because the people providing the service pay income taxes, but that’s true of the workers on an assembly line or in a clothing store (as well as the owners).

The problem, as far as I can tell with this specific proposal, is it is a tax increase solely, without any other benefit. Better proposals I’ve heard involve adding a tax on services but also lowering other taxes in ways that offset that (such as lower income or even sales taxes). And having taxes on sales and services make up more of a tax base is, typically, more stable and less prone to huge booms and busts than income taxes. (That’s been a huge problem in California.) Typically there’s also a minimum earnings cutoff — which might exclude a lot of yoga teachers.

There’s also this little coincidence: Washington this past week was named the healthiest city in the U.S. And this tax would hit the gyms and yoga studios that helped enable that — and all the corresponding societal benefits.

Sort of the opposite of a Sin Tax.

Posted by Steve

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The ultimate householder duty vs. Samadhi

We’ve just finished our taxes.

Is there a more critical, and fundamental, householder duty? And is there one that more tests our “yogic” natures and keeps us so very distant from Samadhi?

I don’t think so.

Happily, I can report that thanks to Bobbie’s beginning to teach last year, we actually had a steady amount of “yoga-related write-offs.” Oh, and before we started the blog, she had her knee surgery. Hi there, medical expenditure.

Yoga may hurt you, but it definitely pays.

Are there any yoga-related deductions you’re willing to divulge? And meditative tricks to keeping sane while doing your taxes, or, worse, figuring out how you’re going to pay what you owe?

For inspiration, here’s a famous devotee, who had his own issues with the Taxman:

Posted by Steve

New York showdown: The taxman versus the yogi

It’s tax crunch time here in the U.S., and for yoga studio owners in New York City it’s an especially rough period.

For the first time, yoga studios are falling under the city’s 4.5% sales tax. And the change isn’t sitting well with those in lotus.

There’s a lot of media coverage of this — figure, the only thing better than yoga + money is the old go-to yoga + sex story — but this Wall St. Journal piece seems to cover it pretty well:

The New York Department of Taxation and Finance has decided that yoga studios fall into a category of businesses—specifically weight control or health salons—that must pay the city’s levy, officials said.

The decision was revealed last April in a bulletin from the department and is now sinking in as yoga studios across the city prepare their taxes. The state—which collects the city’s sales tax—has already begun auditing yoga studios, presenting them in some cases with bills for back sales taxes for the past three years.

“We do see this as a fairness issue,” said Edward Walsh, a spokesman for the Department of Taxation and Finance, noting that Pilates studios have to pay sales tax. “Businesses that provide similar services should be subject to the same taxes in the city.”

The new tax policy has been met with cries of protest from the yoga business community. For years, studios had budgeted without the expectation of a sales-tax hit.

I’d say the two key issues are there in that quote: the fact it’s a change (even a year-old one) and that studios are used to not having to budget for the extra loss from their pockets.

Really, it’s a classic tale of relatively small business versus government: uncertainty, unexpected change, and no clear path forward.

The same group that fought successfully against New York’s effort to regulate yoga teacher training is watching this one. But Yoga for New York hasn’t decided yet whether it will fight the tax change in court, according to the Journal piece. The Journal seems to think there will be a battle, as the city doesn’t appear likely to back down. The root of its argument is: “a 1971 state law which allows cities of more than a million people to collect sales tax on weight-control salons, health salons, gymnasiums, and Turkish and sauna baths.”

See where this is going? The legal argument, if this comes to the courts, will hinge on what yoga is and what yoga studios provide. And you can bet all those “yoga for a good butt” ads out there will be Exhibit No. 1 for the city.

A possible short-term solution is for the city to come up with a more lenient process to allow studios to pay their back taxes.

Either way, you know who will end up covering that extra cost in most cases, right? Yoga students / customers.

So this does impact you, even if you’re not a yoga studio owner or teacher. And other cities could look to New York as a model, and with local governments short on money everywhere… well, you can do the math.

Posted by Steve