State taking larger chunk from paychecks

A new law forces workers to have a higher percentage of state taxes withheld from their paychecks, even though many of those workers already overpay and get refunds.

Don't panic; no one's taxes were raised. The total you owe at the end of the year will be the same, but the amount you pay on each paycheck could change.

The change is aimed at keeping cash flowing into state coffers after federal taxes were cut. If lawmakers didn't bump up the state rates, which are based on federal ones, Arizona would have lost an estimated $14 million in cash flow in 2003, although that would have meant more money in your pocket in the short term.

So, in other words, because the state can't manage it's cash flow properly without continuous cash infusions from your taxed paychecks, they are going to force additional withholding from that paycheck -- money that they have no right to in the first place! -- merely to ease their cash flow problems.

Only a government has the option to do this with force. What would you say if some individual came up to you and demanded part of your paycheck each month, even though he admitted that you did not owe him the money? What if he promised he would pay it all back come next tax refund day -- would that make you feel any better about it?

But the state of Arizona can do it, and no one is supposed to complain. Because it's the government.