One good reason for liberals to vote NO on Proposition 204
It’s easy to see why many people are supporting Proposition 204: they believe it will help children and teachers or improve the infrastructure in the state. Their hearts are in the right place, but their eyes are not. All one has to do to know why a 1-cent sales tax increase will hurt those who can afford it the least is to look toward the bottom of most receipts.
Arizona has one of the most regressive state tax structures in the country. The biggest reason for this is that various stakeholders have often turned to the sales tax as an easy way of raising money. They know “that people tend to shrug off sales taxes because there is no tax return or large lump-sum payment involved”. Any attempt to raise property taxes or the income tax is met with political resistance, but raising the sales tax is a fairly easy thing to do even though it hurts a vulnerable population. That is why a coalition of special interests has assembled to support a $1 billion sales tax.
As a result of this happening repeatedly, low-income and middle-class workers and families pay a much greater share of their income to the state government. High-income people avoid the sales tax by saving and investing more income, but those for which consumption necessarily forms the greatest share of their budget are coerced into handing over a greater share of their money to the state. There are various policy angles that can be debated about whether or not consumption taxes are good or bad, but this is one indisputable point.
The Institute for Taxation and Economic policy found in 2009 that state and local taxes nationwide followed an extremely regressive pattern. “The average tax rate on the poorest 20 percent of families is the highest of all. At 10.9 percent, it is more than double the effective rate on the very wealthy.” And this was only an average. They have consistently ranked Arizona as having one of the most regressive state taxes in the country.
Education is extremely important to all Arizonans, but Prop 204 is the wrong way to approach the issue. Reform is necessary, but a tax that increases the burden on the middle class is not. Prop 204 advances the interests of public sector unions and monied contractors and consultants at the expense of working class people. Vote NO on Proposition 204.