A Taxing Lesson

November 8th, 2019

Sales Tax

(as published in The Daily Memphian)

Let’s review.

A sales tax increase is regressive, it hurts the least of us the most.

To those buying their bread in baguettes, an extra half percent is crumbs. To those buying it past the sell-by date on special, it adds up. To those buying their hot coffee in French and Italian, that extra half percent is lost in extra foam. To those buying it on the way to and from shift work and second jobs, it’s cold. On October 3, we voted in a half percent sales tax increase in a city with a poverty rate approaching 30%, raising our sales tax to damn near 10% on damn near everything we buy in Memphis.

Those promoting a sales tax increase will promise you anything, even if they have no power to keep that promise.

This one, for instance, made it to the ballot through the efforts of the police and fire unions promising to restore health care and pension benefits to city police and firefighters cut in 2014. And, oh, if there’s anything left over, we’ll give it to Pre-K for our kids. And, hey, we’ll fix our potholes and repave our streets with it, too. Promises, promises. The promoters didn’t mention that the mayor and council are not legally bound by the referendum to restore the benefits or spend the new revenue on Pre-K or city street projects. Further, and even more problematic, the rest of the city employees who also had their benefits cut would be cut out of the tax increase windfall. Try to run or fix anything without them.

A sales tax increase creates a new pot of money, and a new pot of money draws politicians like flies to a picnic. 

Shelby County Commissioner Edmund Ford, Jr. is already asking the Shelby County Commission to circle the $53 million to $57 million just placed on the city’s table, asking, pray tell, could there be a slice of the city’s new tax rate for the county? Chairman Mark Billingsley may even call for a vote on a referendum to take some of ours away before we even spend a penny of it. You see, the other six municipalities in our county have already maxed their sales tax rates at 9.75% to pay for their school systems. Memphis and Shelby County didn’t ask for a piece of all those sales tax increases to help fund Shelby County Schools in 2013. Maybe it’s not too late. If Commissioner Ford comes after Memphis money, maybe it’s time to come after Bartlett et al money.

The case for city and county consolidation keeps making itself.

This hot mess of a sales tax increase is something we’ll all pay for in a number of ways. 

The whole premise was to codify that some of us are better than others, that mistakes made in the past that threatened the fiscal viability of the city should threaten the future of some but not all, and that the financial burden should fall on some but not all.

While our police and firefighters are to be respected and thanked for putting their lives at risk to protect us, everyone else who serves us cannot be simply ignored. The people who process and provide and keep us up and running, the people who work in Memphis heat on and under Memphis streets have spouses and kids and lost benefits, too. Years of bad policy made the cuts necessary across the board. Selective restoration is worse policy still.

Problems and solutions, failure and success, should be shared things in a city.

I’m a Memphian, and we failed each other on October 3.

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