Tax soda to level the field
Making America exceptional was, among other things, the decision made long ago to establish a federalist system of government, rather than a unitary system. Most of government is run by the states, not the feds. In France, for instance, the Ministry of National Education controls nearly everything French schoolchildren learn. In the U.S., however, the Department of Education has limited power, because local control was deemed critical to teaching American kids.
There’s a reason I’m noting this. It’s not to refresh your memory of a Civics 101 course you took ages ago. It’s to encourage all of us to think more broadly about taxation. In a conventional debate, we tend to think provincially — income tax, sales tax, property tax, etc. That’s understandable given most of the tax you and I pay goes to state and local governments. But how would feel about paying high taxes if you knew that some states have the luxury of keeping their taxes low on account of Connecticut and other states sending more than their fair share to the United States government?
Here’s another mind-bending question: What if there were a way for Connecticut to get some of that money back by — wait for it — taxing soda? I’m not a tax accountant, but it seems to me that our legislators have a chance to do that in the current session in the Connecticut General Assembly. It would be messy. It might be morally questionable. And there would be definite winners and losers. But in the end, by levying a penny-per-ounce tax on sugary drinks, we could end up taxing the United States government.
WalletHub is a personal finance website that released a survey last month ranking the states according to how many tax dollars they send to the federal government compared to how many they get. Connecticut, the survey found, ranked 42. We send more than we receive in the form of federal contracts, grants and other kinds of financial assistance. Kentucky is the most dependent on federal largesse while Delaware is the least. Florida is in the middle.
Read more: http://www.ctpost.com/business/article/John-Stoehr-Tax-soda-to-level-the-field-11073814.php
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If you look only at the first measure—how much the federal government spends per person in each state compared with the amount its citizens pay in federal income taxes—other states stand out, particularly South Carolina: The Palmetto State receives $7.87 back from Washington for every $1 its citizens pay in federal tax. This bar chart, made from WalletHub's data, reveals the sharp discrepancies among states on that measure.
