The Biggest Threat to Our Business … Hovering and Heinous

In the world of fiscal policy – if there’s a public or private behavior that has a disagreeable effect, then government has a tool to move behavior to a desired effect: taxation.

If the world has too much global warming, then tax fossil fuels and carbon emissions.

If smoking causes cancer, then tax cigarettes.

If alcoholic consumption brings on social ills, then tax wine and spirits.

If the world is becoming more unequal, and the middle class is under threat, then tax wealth.

But if the world has too much economic activity … why would that not be only a good thing?

In the United States (and probably elsewhere), the trouble with taxation — unfortunately, moral judgments aside — is that it is used too often for another objective: simply feeding the government leviathan. Failure to curb public spending, excessive entitlements and inefficiencies result in public debt and harrowing deficits – and a need for government to raise revenue anywhere it can.

But what if raising those taxes works against an overwhelming public good — that of economic growth that spurs even more government revenue? What if jobs, sales, manufacturing, services, the business of business, were all under threat by such a move?

Shouldn’t such a tax proposal be rejected on first consideration? How could such a proposal ever be offered in the first place?

Say hello to today’s U.S. Congress. Right now, in key House and Senate committees that consider taxation, budget and appropriations, is an idea that would be nothing short of ruinous to advertising and marketing: the removal or reduction of tax deductibility for advertising expenses, or the amortization of those expenses over a long period of time, far beyond advertising’s more immediate and practical impact.

Just more than a century ago, the federal government enacted an advertising expense tax deduction – rightly understanding that advertising activity spurs economic growth. That in turn creates jobs, sales, tax revenue, and other beneficial effects that lead to a virtuous circle of positive effects. I congratulate our policymakers … of 1913. That decision literally helped create a golden era for advertising – which helped produce the world’s most successful economy ever known.

Hiding Tax Increases: USPS Taps Mailers’ Budgets, Again

When the cost of oil and gas plummets, that’s when states—looking for revenue—make a move to raise taxes on gasoline, in hope voters will hardly notice. Of course, when the price of gasoline inevitably increases months or years later, that tax on gasoline becomes painfully obvious and more pronounced: Small cars get driven, while the big guzzlers stay in the garage or showroom. Conservation rules the day.

When the cost of oil and gas plummets, that’s when states—looking for revenue—make a move to raise taxes on gasoline, in hope voters will hardly notice. Of course, when the price of gasoline inevitably increases months or years later, that tax on gasoline becomes painfully obvious and more pronounced: Small cars get driven, while the big guzzlers stay in the garage or showroom. Conservation rules the day.

Like a tax-hungry legislature, the United States Postal Service is looking to raise postage again—a surprise rate hike request, given the exigency first taken from mailers’ pockets last year that is still in effect today. The U.S. economy may be back—but marketers aren’t stupid on postage, they well know the pain. Nothing takes business elsewhere and more rapidly than unplanned, surprise cost increases.

My mindset on the entire exigency has always been suspicious. Purportedly to recover lost funds from the impact of the Great Recession (2008-09), the USPS exigent increase, on top of the inflation-indexed release of 2014, has represented a collective 6 percent tax of a different kind. What business gets to pass along its Recession “losses” to its customers? Direct mailers, unlike drivers at the pump, have very much noticed.

Perhaps the economy is doing well—heck, even direct mail volume is holding up. However, better economic times—which can cover some fiscal sins—can’t hide what needs real fixing inside the Postal Service. We all know that USPS deficits and defaults, which postal management appeared to try hard to avoid, with cost-cutting, network rationalization and other initiatives, are really attributable to Congressional mandates, and not the Recession or digital migration.

Well the U.S. economy is moving in the right direction, and has been for six years, and may grow another 3 percent or more this year (2014 fourth quarter aside). Business outlooks are generally good, and Apple among others just set a quarterly earnings record in profit. Jobs have come back, though the labor participation rate lags, and pay packets have barely budged. The stock market, volatile yes, is booming again. Few may feel very secure, but the underlying data shows the recession of 2008-2009 is far behind us.

Even the USPS knows that the U.S. economy is growing. Direct mail volume held its own in 2014—the digital death knell has been greatly exaggerated. Perhaps cooking up the exigency, and another, surprise inflation-indexed increase this year, is the Postal Service’s way of taking another revenue injection when the going is good. Certainly that’s more reliable income than waiting for Congress to act on what is most meaningful: backing off ridiculously punitive, pre-funding requirements for retiree health benefits, letting the USPS offer employees its own healthcare plans, and halting silly moratoriums on USPS infrastructure needing to resize to fit the times.

I always thought Congress, with the USPS in fiscal crisis and default, and a difficult severe recession, would have prompted members to act. The White House, too. Nothing in the way of new reforms ever emerged. Maybe Congress, too, is waiting for “good times” again to stage its next postal act. Let’s hope this next one doesn’t cost mailers even more. The present situation is unsavory enough.

Melissa Campanelli’s The View From Here: How Twitter Helped Tax Season Run Smoothly for TurboTax

If you think you’re busy putting your taxes together during tax season, think about how busy it must be for the employees at Intuit, who work with its TurboTax brand.

If you think you’re busy putting your taxes together during tax season, think about how busy it must be for the employees at Intuit, who work with its TurboTax brand.

To help make the process of answering all the questions it receives during tax season more efficient and effective, TurboTax launched a major Twitter initiative in February. It enlisted 40 employees — everyone from tax experts to product managers to support reps — to answer both tax and software questions through its Twitter account.

The process was managed with the help of ExactTarget’s Twitter platform CoTweet, a sort of CRM Twitter software that enables users to easily search for questions across Twitter about taxes; assign customer tweets to the right expert within the company; and respond to the customer in short order. In fact, the program enabled TurboTax employes to answer tweets in less than four minutes.

The program worked. After April 15, TurboTax surveyed its customers and received the following results:

  • 54 percent of TurboTax Twitter followers specifically sought tax help;
  • 48 percent of users said TurboTax was effective in helping them complete tax returns; and
  • 77 percent of users said they’d likely recommend TurboTax.

Best practices
Because of the success TurboTax enjoyed, I asked Chelsea Marti, public relations and social media manager at TurboTax, to come up with some best practices associated with using Twitter for business. She offered the following three:

1. Remember that you’re a brand. “While you may want to personalize your approach with your Twitter followers, remember that you’re a brand first; don’t invade their personal spaces,” Marti said. “Start out by introducing yourself and saying hello, then start answering questions. Don’t start hawking your products or throwing information at them right off the bat.”

2. Keep it fun. “We find that we have much better engagement with followers when we’re light-hearted and friendly,” Marti said.

3. Plan ahead. “Before you begin an enterprise-level Twitter program, have a plan in place,” Marti warned. “Spend a substantial amount of time searching for how people are talking about your brand on Twitter before answering questions.”

Do you have any Twitter for business best practices you’d like to share? Please do so here.