Two great reminders about taxation from Locke Foundation staffers/bloggers.
First, Mitch Kokai reminds us that tax hikes pay for the lowest priority, not the highest.
Second, Chad Adams reminds us there is no limit on how many times a county can put either the land transfer tax hike or the sales tax hike on the ballot. Below is his analysis ofTuesday’s results and his prediction of what will transpire as November approaches:
Every single instance of a land transfer tax was defeated once again. That makes 11 wins for citizens and 11 loses for pro-land-transfer-tax folks. Ashe County had probably the closest vote on this tax. Even there, (4,088 against and 3,321 for) the numbers reveal that citizens do not have an appetite for increasing the deed stamp tax by 200 percent.
What we should learn from this is that local governments need to go back and look at school budgets more closely. Citizens are beginning to realize that school boards are increasingly wasteful in their spending and do so without accountability. With 30 percent dropout rates, wasted money, expansion budgets funded with continuation funds, and fund balances that are loosely followed and not even required by law, commissioners and local papers should be asking tougher questions and demanding more accountability.
Chambers of Commerce and newspapers should push for citizen advisory groups to come together and truly come up with a plan that includes the broad spectrum of political and fiscal ideology. More often than not, conservative voices in these referenda are simply ignored, as Chambers spend tens of thousands of dollars to promote increasing taxes that are not in the interest of local businesses.
What will probably happen is far different. Counties will figure that sales taxes have a better chance of passage than land transfer taxes. Hard to believe it took 11 losses to figure that one out. Then they’ll look at what happened in Cumberland County and put initiatives back on the ballot. They’ll also look to Alexander County for an example of timing.
The legislature put no limits on how many times these initiatives can be place on the ballot. They also placed no sunset on these taxes. Once passed, these taxes are in place virtually forever, long after the purpose for their passage has been paid for.
Governmental types know this truth; it’s incremental, much like the creeping increases in fees that we see year-after-year. As such, they only have to win one referendum once, while those opposing tax increases have to win every time it comes up for a vote.
