It’s not just individuals and businesses who are being hurt by the financial crisis brought on by the Coronavirus pandemic. Governments are finding themselves strapped for cash after offering consumer bailouts, and taxpayers will be asked to foot that bill.
Zero Hedge reports that tax revenues at all levels of government; local, state and national, have plummeted due to the pandemic. And the most pain is being felt at the city level where sales tax revenue has taken a nosedive. That means governments are in the same boat as individuals in trying to determine how to make ends meet.
But governments have an advantage. They can raise taxes, and many are planning to do just that. The only thing to be determined is how much they can be raised before taxpayers squeal.
The most likely target for tax increases is real property, because people pay for their housing before most other things. According to Zero Hedge, Nashville, TN mayor John Cooper has proposed a property tax increase of 32 percent, saying there is “no choice but to have a significant increase in property taxes.” Dallas is mulling a 8 percent property tax increase, but will need to circumvent a state law which limits such increases to 3.5 percent. Chicago is also considering a property tax increase, and California, which already has some of the highest taxes in the nation, is looking at a partial rollback of Proposition 13 to allow the government to assess commercial properties differently than they do now.
Other states are looking at a variety of tax increases, including corporate income taxes, taxes on online purchases, excise and sales taxes, according to CNBC.
So it would seem that it’s not a question of whether your taxes are going to go up, but how much and on what. Apparently, what the government giveth it can turn around at taketh away.