2. Sales tax exemptions are a bad idea.
Yes, we must exempt food because it is regressive to the poor! It is, but a sales tax is generally regressive. That's how it works. Next, we need to exempt medicine because it hurts those on a "fixed income" (code for old people). And clothing, because it harms large families. Also, we should exempt diapers and other essentials for raising babies. Farm and ranch goods. Health related items. And...
Exempting real food, clothing, and prescription drugs is good. People need those things. They don't NEED Large Sreen TVs, Halloween decorations and grills. PA did not have a State Income Tax until 1971 (the year our family moved to OK) but they did have a 6% sales tax with the exemptions I just mentioned. There was also, of course, property tax but I don't think it was a personal property tax on things like furniture and cars. (Car tag prices were a real jolt when we moved here too.) I think prescription drugs may already be exempt in OK or it's already included in the $10/90 day generic refills I get. Whenever I go to Atwoods or Tractor Supply Co, they ask if I have a farm exemption so that is probably already in place. If cities get to use property tax, I believe a reduced sales tax with exemptions is appropriate. Poor people will be paying property tax too in the form of higher rents.
And guess what? Politicians get to set all these definitions. And lobbyists get to give input on these items. Soon - Redbull is a food items and is tax exempt.
A risk I am willing to take if cities get property taxes.
3.
- Property taxes are more stable. Property doesn't fluctuate nearly as much. it is easier to collect and easier to enforce. It is nearly impossible t cheat. Police, fire, and other essential service should draw essential operating funding from the most stable source available.
Which also makes it easier to inflate budgets.
- Items that cost money, should pay more tax. Not a "sin tax," but a society tax. Tobacco, alcohol, and gambling cause problems that society has to pay for. So they are rightfully taxed more. Budweiser doesn't kick in when Drunko McDrunk beats his wife or drives drunk. The Cherokees don't kick in when mom blows her savings and relies on social services to pay the bills (you can't tax the tribe and they are unlikely to help, but you can tax gambling income).
Honest gamblers already pay tax on winnings above losses. With all the winning going on at the local casinos, the Feds and the State should be flush with tax money.
- On the State level - assume we get ZERO oil and gas revenue. What we do get, put it in a trust fund. The Nordic countries did, and now their governments are loaded. Hand to mouth is a bad idea for a household, or a state. Relying on boom or bust revenue predictably fails eventually.
Total reliance on boom/bust income is not smart. Neither is totally discounting it.
4. Finally, view expenditures as an investment.
What is the ROI? It doesn't have to always make dollars and cents, but it should make sense. A park may raise property values, it may encourage development, and it will increase quality of life. All of this should be considered.
Education draws in quality residents. Helps attract employers. And in the long run prevents crime, raises earnings, and generates more tax revenue.
The City should be looking at a 20 year horizon as a minimum. Instead, we are worrying how we feed ourselves when winter comes.
I agree with #4 although if my property value goes up and my taxes go up, I want to see something for it. Same-old, same-old but costing more money just doesn't cut it.