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Thursday, July 12, 2007

Property Taxes skyrocket in Indiana - time for a Fair Tax

I just got my property tax bill last week. It jumped 70%. That is pretty typical for most that live in my county - though some unfortunate souls just a couple miles south of me saw their taxes rise by 200% or more! Now the people are up in arms.

I have said it before and I'll say it again, we need to get rid of hyper-inefficient forms of taxation like that of property, corporate income, and payroll taxes. We need to support the more efficient tax on lifetime wealth - that is - the sales tax. Why disincentivize someone to own a home? Why disincentivize a company to purchase a new factory or certain types of equipment? Why should corporations have to pay taxes, and then have their owners turn around and pay taxes? Why should people be burdened with form after form after deduction after exemption, etc.... What can we do to ease the US's obsession with consumption? What can we do to increase overall investment and reduce interest rates in the US? What can improve our trade balance without threatening countries like China? What......what..........what other than a sales tax, a FAIR TAX.

It's time for Indiana to support the Fair Tax, and it's time to urge our immediate neighbors and our country to support it as well.

We don't need worthless short terms fixes like Mayor Bart Peterson just espoused - a 'fix' that will have us paying more than we bargained for NEXT year, and years after that. We need a real solution and we need to start getting real.

To prove to you that I'm not biased about this, you should just know that if Fair Taxation were adopted in Indiana and the US, I would be out of a job (albeit temporarily) since my work deals with tax credits. And tax credits are great, and can be useful, but the best incentive you can give a company is tax transparency, and a corporate income tax rate of 0%.

In the long-run, a sales tax that replaces other taxes (and yet maintains progressiveness via a rebate) is more efficient, lowers the tax burdens of most all groups of people and corporations, and is transparent and easy to follow.

In the short-run, why not at least offset some of the property tax jump with a small county-run sales tax. Of course, this kind of thing has been talked about before in Marion County - but sloppier minds always prevail sadly.

In the very short-run (this year, ie now) there are no easy answers - but I think at least a pause, a breath, and a proper reassessment are in order.

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