Sales Tax in the OC
Amongst the great American traditions, baseball, hot dogs and apple pie, is the hatred of paying taxes. Arguably, the American Revolution was one gigantic tax revolt because until the British levied taxes on the colonies hardly anyone was talking about independence from British rule.
Americans avoid paying taxes at all costs (no pun intended) as is evidenced by the popularity of online merchants. People did not mind waiting a few days to get their stuff as long as they did not have to pay sales tax. So many people made internet purchases that the state government tried to figure out a way to tax purchases made on the internet. Of course, they had no trouble levying the tax on internet purchases because that is what governments do best, find thing to tax.
The difference between the New York State and Federal government’s taxes and the British taxes is that when the British taxed the colonies they did it without our consent; at least that was the basis of the argument back in the 1770s. Now, supposedly with our consent, we are taxed a lot more and have taxes that the British government could have only dreamed about and might make a lot more Americans wish we only had to deal with tax on printed material and tea. At least then, we would be able to keep our whole paycheck.
This brings me to the real point of this column and that is our county sales tax. At present Orleans County has an 8% sales tax rate, 4% goes to the state and 4% the county. None of the surrounding counties has a lower sales tax rate so why don’t we lower our sales tax rate by 1% as a way of attracting consumers into the area, and subsequently more retail business.
The obvious counter argument to this idea is that the county government will claim that they will lose revenue. In reality, the county may see a rise in revenue if consumers who are equal distances between major retail stores near the county border decide to come into Orleans County to make their major purchases. Basic economic theory tells you that most people will make purchase based on price, which is why gas stations in the same area often do not let competitors beat them in price, by even a penny.
Orleans County could use the lower sales tax rate as a promotional tool. It would be nice if this county could boast the lowest sales tax rate in the region. It is a legitimate way of promoting business growth while tapping into Americans hatred of paying taxes and draw in needed tax revenue from other counties. The idea of lower prices is the basis for stores like Wal-Mart, which built its reputation on low prices.
Over the past few years, the county government’s sales tax revenue has exceeded the budgets projections. In a worst-case scenario, the lowering of sales tax would result in revenue closer to the actual projection. The current rate of 8% was supposed to be temporary, but like thruway tolls the government sees the extra revenue as rightfully theirs forever rather than temporary.
A higher sales tax rate hurts those on a fixed income, like our senior citizens. Lowering the sales rate helps those who need it most, working people and retirees. A rate of 7% countywide along with the promise that property taxes and other fees would not be raised would be a tremendous benefit to the area and generate positive publicity for the area.
Americans avoid paying taxes at all costs (no pun intended) as is evidenced by the popularity of online merchants. People did not mind waiting a few days to get their stuff as long as they did not have to pay sales tax. So many people made internet purchases that the state government tried to figure out a way to tax purchases made on the internet. Of course, they had no trouble levying the tax on internet purchases because that is what governments do best, find thing to tax.
The difference between the New York State and Federal government’s taxes and the British taxes is that when the British taxed the colonies they did it without our consent; at least that was the basis of the argument back in the 1770s. Now, supposedly with our consent, we are taxed a lot more and have taxes that the British government could have only dreamed about and might make a lot more Americans wish we only had to deal with tax on printed material and tea. At least then, we would be able to keep our whole paycheck.
This brings me to the real point of this column and that is our county sales tax. At present Orleans County has an 8% sales tax rate, 4% goes to the state and 4% the county. None of the surrounding counties has a lower sales tax rate so why don’t we lower our sales tax rate by 1% as a way of attracting consumers into the area, and subsequently more retail business.
The obvious counter argument to this idea is that the county government will claim that they will lose revenue. In reality, the county may see a rise in revenue if consumers who are equal distances between major retail stores near the county border decide to come into Orleans County to make their major purchases. Basic economic theory tells you that most people will make purchase based on price, which is why gas stations in the same area often do not let competitors beat them in price, by even a penny.
Orleans County could use the lower sales tax rate as a promotional tool. It would be nice if this county could boast the lowest sales tax rate in the region. It is a legitimate way of promoting business growth while tapping into Americans hatred of paying taxes and draw in needed tax revenue from other counties. The idea of lower prices is the basis for stores like Wal-Mart, which built its reputation on low prices.
Over the past few years, the county government’s sales tax revenue has exceeded the budgets projections. In a worst-case scenario, the lowering of sales tax would result in revenue closer to the actual projection. The current rate of 8% was supposed to be temporary, but like thruway tolls the government sees the extra revenue as rightfully theirs forever rather than temporary.
A higher sales tax rate hurts those on a fixed income, like our senior citizens. Lowering the sales rate helps those who need it most, working people and retirees. A rate of 7% countywide along with the promise that property taxes and other fees would not be raised would be a tremendous benefit to the area and generate positive publicity for the area.
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