Keep off Internet’s ‘wall of tax shame’

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in Small Business Tax

In colonial times, governments posted debtors' names in the town square to embarrass them into paying up. More states are doing the same thing, with a 21st century twist: They're launching Web sites that list companies and individuals who owe big back-tax bills.

So far, according to The Associated Press, 13 states use the tactic: California, Colorado, Connecticut, Illinois, Georgia, Louisiana, Maryland, Minnesota, New Jersey, North Carolina, Rhode Island, South Carolina and Washington. States aren't playing coy about the purpose. Example: Louisiana dubs its site "CyberShame," www.rev.state.la.us/sections/cybershame.

In addition to the obvious embarrassment factor, businesses should avoid landing on such lists because creditors, suppliers and clients may be reading, too.

Expect more states to use online shaming. Reason: Georgia, the latest state to employ this tactic, collected $1.2 million in its site's first two months.

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