Lawmakers in Chicago are forcing citizens to fear their tax burden more than the inevitable winter cold.
In addition to boasting one of the highest sales tax rates in the country, the infamous “Netflix tax,” and a pending tax increase on water, Chicagoans will now see an increase in both property and fuel taxes for the purposes of funding the “Red Ahead” program. The program seeks to “rebuild vital infrastructure for Chicago’s future,” but rests upon a premise shakier than a rusting portion of “El” tracks.
City officials claim that monies levied from these specific tax increases will go exclusively to fund the Red Ahead project. However, constituents should raise their eyebrows reading this statement, given the pension debacle occurring within the state. Both the State of Illinois and the City of Chicago have misappropriated funds to the tune of hundreds of millions of dollars. Why should Chicagoans trust city lawmakers to handle these funds appropriately amidst an ongoing financial crisis? City officials in Washington, D.C., certainly did not handle funds for their streetcar program well — $200 million over the last 10 years on a streetcar system that barely functions.
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Why is it when politicians try to “fix” a problem, they always seem to reach for your wallet? Governments from all across the world, from Mexico to the United Kingdom to Berkeley, California have made a strong effort to warn its citizens about the dangers of sugary drinks. But some have gone even further by imposing excise taxes on citizens who consume these sweet nectars.
The city of Philadelphia, where the Declaration of Independence and the Constitution were written, is on the verge of passing a tax on sugary drinks. Taxes are typically toxic to
economic growth but a sugar tax is especially harmful to those in a lower socioeconomic
class. The common argument for a sugar tax is that it combats obesity while having no negative effect on the public.
Yet, increasing the price of sugary drinks does not necessarily translate into a healthier citizenry, as shown by a Tax Foundation study:
Detailed economic analysis shows that when the consumption of soda is discouraged with higher prices, children and adolescents tend to substitute other food or drink to make up for lost calories. Taxes on soda could even cause an increase in caloric consumption, as other substitutes can have higher calorie contents than soda.
The only certain effect of the sugar tax is that it will increase prices for all consumers. Politicians and presidential candidates claim to care about the poor and middle-class families, but increasing the prices of goods they consume is not caring—it’s callous and
unproductive. When politicians claim the middle-class is disappearing, they should be reminded that many families have been taxed out of the middle class.
Sugar may be addictive, but clearly not as addictive as taxation. When politicians blatantly try to increase taxes on the poor and middle class, it shows that addiction.
Tax cuts are a major feature of Republican presidential candidates’ economic policies, and it showed in last week’s debate.
But not all tax cuts are created equal. In particular, the drive to cut individual rates is misguided. In the tax code, the real culprit for sluggish economic growth is the corporate tax.
The United States has the highest corporate tax rate in the developed world—39 percent, when including an average of state levies. In the 1950s, high corporate taxes provided a sizeable chunk of federal government revenue—up to 32 percent in some years. But today, the tax makes up only about one tenth of federal government revenue.
Read the rest on Watchdog here.