Comments on: Local Tax: Ups and Downs

By: Josh Smith

Josh Smith — Mon, 22 Jun 2009 18:12:38 +0000

I wasn’t really surprised that people would make that trade off, just disheartened, as it may predict bad things for the future of free markets.
“Do you think this lawyer will eventually sue the City of St. Louis over their taxes?”
Unlikely, but it was suggested in the article that he may be after larger cities in the future. I doubt he will try it in St Louis.
“Do you think that lawsuit should force the city to lower its sales tax rates (via removing part of the generaly sales tax), or should the state adjust the laws as discussed in the article?”
I thought about mentioning in my post something that has come up in book club before: jury trials are black boxes where the outputs scarcely resemble the inputs. One of the reasons for huge out-of-court settlements is that even if it’s a nuisance suit which likely shouldn’t even get the courts time, a jury may find in favor of the frivolous-lawsuit-filer. My point is, I doubt that what these cities are doing is illegal, but it is easier to pay off this guy than risk a pricey court battle. So while I don’t think that a lawsuit should force St Louis to lower it’s tax rate, I do think that lower taxes are better, even if it means less local benefits, because of the pernicious problem of aggregating preferences. This is especially true of large population centers: more people means more possible outliers who don’t want the services their taxes pay for.

By: David Stokes

David Stokes — Mon, 22 Jun 2009 17:57:58 +0000

Josh,
Do you think this lawyer will eventually sue the City of St. Louis over their taxes? Further, do you think that lawsuit should force the city to lower its sales tax rates (via removing part of the generaly sales tax), or should the state adjust the laws as discussed in the article?

By: David Stokes

David Stokes — Mon, 22 Jun 2009 17:55:44 +0000

It surprises you that people are willing to make that trade-off? How can it possibly surprise you? Each of us makes these decisions every day of our lives, in big and small ways. For myself, less expensive property, less regulation, and everything else takes a distant backseat to the ability to walk to, and more importantly walk home from, the bars and restaurants of Clayton and University City. I value the ability to enjoy beer and wine and get home safely (for myself and others) much more than it bothers me that I have to get a permit to redo my backyard fence.