Taxation without Representation
In June of 2017 I was sitting in a school board meeting for the Iron County School District. In Utah, the school district can raise property taxes for those within its boundaries, with only the requirement that they let everyone know that they will be raising said taxes.
The school board watched us present our arguments, nodded (as if they were listening to our concerns), and then voted the way they wanted to, regardless of what the rest of the citizens said.
Politicians can get away with raising taxes to pay government employees more, because government workers tend to be pretty interested in giving themselves a raise. The same is true for Union workers. They will show up to vote for small elections while private sector workers are too busy or too complacent to pay attention.
More People Demands Higher Tax Rates?
The complaint of the school board was that with the area growing, more teachers were needed to accommodate teaching more students. This only makes sense if none of the new people moving in are paying taxes.
On the contrary, people tend to move where they have better opportunities for work. As population increases, there are more people to pay taxes, and so tax revenue goes up without the need to raise taxes. As there are more people to pay taxes, schools get more funding to accommodate more students, while citizens get to keep their own money.
Of course, that is dependent upon us not driving away the prosperity of our citizens with higher taxes. The more taxes go up, the less prosperity citizens have. Companies downsize, or stop inventing new products to try to compensate for the loss of income, while small businesses are crushed under the tax burden.
When our people are left less prosperous they can’t pay as much in taxes, and tax revenue goes down. Citizens then either go into a lower tax bracket, having less flexibility to move into a higher tax bracket, or they move to a city where they can keep more of their own money.