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November 2004

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Subject:
From:
"Dr. Joe Dumas" <[log in to unmask]>
Reply To:
Dr. Joe Dumas
Date:
Wed, 24 Nov 2004 14:32:12 -0500
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Mary Coleman wrote:
> I agree that Tennessee taxpayers are tired of always having to pay more,
> more, more  for taxes for gas, food, clothings, etc.

Good!

> I myself would much
> rather pay a State Income Tax and have la lower sales tax. Tennessee is one
> of 8 states in the union that does not have a State Income Tax - and has
> one of the highest sales tax.

Changing to a different kind of tax would not solve any problems;
rather, it would probably make things worse.  An income tax would, by
design, increase the overall tax burden on state residents.  (When was
the last time you saw any new tax that was revenue neutral, let alone
decreased the overall tax burden?)  An income tax would just shift this
increased burden around to be paid in a different, more subtle way.  By
taking money out of your paycheck before you ever saw it, politicians
could easily manipulate the rates, deductions, etc. to get more money
out of you without that "hitting home" the way tax increases do now.

At least when the sales tax goes up you see it every time you pay it,
and thus are resistant to increases.  And one of the best features of
TN's sales tax is that it simply won't bear further rate increases.
Thus, pressure has been placed on politicians to finally do something
about the budget.  I can promise you, if we had a state income tax
Governor Bredesen wouldn't be doing a thing to try to rein in TennCare.
  As it is, he has no choice.

The other best feature of a sales tax, if you have to have a tax, is
that everyone pays something, and thus everyone has a stake in making
sure government is run efficiently rather than wasting "our" money.  An
income tax would unfairly have fewer people paying more money; those who
pay nothing, and only receive benefits, would have no disincentive to
vote themselves more benefits at the expense of those who do pay, and no
incentive to make sure the legitimate functions of government are
implemented without waste and inefficiency.

 > So we will continue to pay more, more, more
> for sales tax until our legislators have the sense to impose a much needed
> State Income Tax.

This holiday season, I am thankful that I live in one of the nine states
that *doesn't* have a general income tax ... and also thankful that even
my Democratic governor can now see that we can't go on providing
unlimited medical care for 1/4 of the state's population forever.  Your
mileage may vary.

--
"Remember that a government big enough to give you everything you want
is also big enough to take away everything you have." -- Senator Barry
Goldwater

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