Are More Taxes Really the Answer?

St Louis Post-Dispatch reporter Mark Schlinkmann had a story on Thursday about a proposal to increase a parks tax in the St. Louis region in order to pay for the federal government’s plan to improve the Arch grounds (Sales tax increase sought to help pay for Arch grounds improvements). You may have been inclined to have stopped reading after you saw “St. Louis,” because you don’t live in the area and think the proposal doesn’t affect you.  I won’t ask for a show of hands, but if that was your thought, you should think again. Here’s why.

It’s true the proposal would only affect sales tax rates in St. Louis City, St. Louis County and  St. Charles County. It’s also true that the proposal requires the tax increase to go to a vote of the people separately in each of those areas. However, everyone who has the occasion to pass through and pay sales taxes gets to pay for the proposal, if adopted – but that’s not even the real problem with the proposal.

The real problem is the idea that there has to be a tax increase at all. Why is it that government’s (or, in this case, a quasi-governmental body’s) first refuge is usually asking for more money rather than using existing revenues? Or better yet – why isn’t there the consideration of a user’s fee (you know, a “those who use the venue, pay for the venue” type of approach)? The fact of the matter is that this type of tax proposal can be offered as a “solution” anywhere, and its success in the St. Louis region can pretty much ensure that many other areas will look at the “proposal’ as a solution to their fiscal needs for some project.

If you don’t believe that this tax trick is a possibility in your area – you need only look at the sales job that is being used to take away your access to over-the-counter drugs that contain pseudoephedrine. It’s happening in rural, suburban, and urban areas!

There are a lot of questions to be asked about using local taxes to fund federal projects. Just a reminder, though – federal money is our money, just like the federal debt is our debt.

The feds get to make the decisions on the project, so why should the local taxpayers be asked to be double-taxed to support those decisions? The typical community leader response is “because of all the money the project will bring to the area.” That’s never a good answer for double taxation. It’s not usually a good answer even when it’s not double taxation!

Forget for a moment that double-taxing local taxpayers to pay for a federal project is very bad policy.  There is yet another way to do it besides more taxes or user fees.

The existing regional parks statute could be changed to simply allow any or all of the existing sales taxes collected to be used for the Arch grounds project. This authorization would include the local share as well as the share that goes to the Great Rivers Greenway District. It would be submitted to a vote in each of the counties and St. Louis City currently paying the tax to ask their permission to redirect some portion of the current tax – to be specified in the ballot language – to the Arch grounds project.

No tax increase for the people already suffering under hard economic times. I suspect that the folks at Great Rivers Greenway District may not be so enthused with the proposal to surrender existing dollars.