A Regressive Tax is No ‘Philosophy’

By: - June 19, 2008 12:26 pm

Wake County Representative, Deborah Ross was quoted in the Under the Dome column this morning criticizing the sales-tax temporary glitch in the legislature's effort to establish a state public transportation fund.

Ross is quoted:

"I guess people can put up roadblocks by saying their philosophy is more important."

With all due respect to Rep. Ross, the unstable and unbalanced nature of sales taxes is no "philosophy". Sales taxes are unsuitable for funding public transportation. Sales tax receipts will flatline or decline during economic downturns at a time when more people will be using public transportation. Sales taxes place the greatest burden on poor and middle income people. They also only apply to goods not services. Over the long term that imbalance will mean they become less successful in raising revenue.  

The Charlotte experience shows that expanding public transportation is a popular and successful policy, not that sales taxes are the right way to fund such an expansion.

Those who argue that low and middle income people will use public transportation a great deal and it is therefore OK to soak them for the money to build, expand and maintain the system need to turn their attention to other beneficiaries of public transportation — business, real estate developers and professional class commuters — and ask: Why are these people getting a free ride by comparison?

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