News - Are statewide sales tax holidays a legitimate bargain?
Yes. High taxes and big government form a vicious cycle that suppresses economic growth.
A two-day sales tax holiday won't rocket Georgia's economy into recovery, but it's a step in the right direction. It's also a conspicuous government acknowledgment that taxes drag down the economy. Every dollar taken in taxes is a dollar not spent or invested by individuals. Reducing private spending and investing puts a brake on economic activity, stifling growth and job creation.
When you tax something, you get less of it. Tax income, and you get less income. Tax investing, and you get less investing. Tax spending, and you get less spending. That's the basic economic truth driving Georgia's sales tax holiday. In overwhelmingly approving the measure, Peach State pols of all stripes agreed that shackling the taxman tends to free the economy.
I'll support any tax holiday, however brief and narrowly drawn. But if we really wanted to get the economy humming, we would slash taxes across the board. Permanently.
Today, taxes in America are at a record high, with government at all levels seizing 32 percent of our national income. The average family now pays more in taxes than for food, clothing, shelter and transportation — combined. High taxes and big government form a vicious cycle that suppresses economic growth. When high taxes swell revenues, government expands into new functions. When such functions become entrenched, they create an excuse for still higher taxes.
Here in Georgia, the boom of the 1990s gave Democrats a blank check toward expanding government. Over the last 10 years, state spending ballooned 86 percent. (Georgia's population, meanwhile, grew 26 percent.) Today, the boom is gone, but the hog-wild spending continues. House Democrats recently passed a supplemental budget with enough pork to build a barbecue sandwich visible from outer space. Democrats threw your money away on, among other things, "stress control" and "alternate life paths" programs for troubled youths. Price tag: $93,086.
If a fleeting little tax holiday is good for the economy, voters should ask their elected representatives at all levels why much larger tax breaks wouldn't be far better. In fact, if government's total share of national income were somehow reduced to 25 percent from the current level of 32 percent, it would unleash an economic boom of unprecedented size and duration.
Of course, all we're talking about now is suspending Georgia's sales tax for a couple of days. Even so, two days of starving the taxman are better than none.
If Luke Boggs had his way, every day would be a tax holiday.??