Getting rid of of local
and state sales taxes and substituting them with uniform sales taxes such that it
would become the prerogative of the federal government do the collection and subsequently
give back to state governments in piecemeal would gradually set a wrong
precedent and usher in centralization which is alien to democratic governance. The
constitution of the United
States
According to Bowen,
Haynes, and Rosentraub (2006), states spend tax dollars with the view of
developing their economies in the fields of education, social and safety
programs, and healthcare. Giving the federal government what would have been
the prerogative of state governments would undermine infrastructural
development and lower the living standards of citizens in all states. When states
collect local and sales taxes, there is that sense of ease and competition and
the tendency to prosper to a desired level.
Devolution of power,
a significant model of governance that spreads power such that states enjoy the
right to administer state public policies, is a vital tool for increasing state
and local government responsibilities especially the formulation of local laws,
and the delivery of goods and services without federal government involvement
(Bae, 2008). State and local governments are more capable than the federal
government in the delivery of goods and services to the local population. The
closeness of state and local government to the people in need of goods and
services and the efficiency of service delivery is one factor that cannot be
ignored. States have a better role to play in local and state matters than the
federal government.
Retail taxes are usually generated from individual purchases from sales transactions. A sales tax is a tax levied on a buyer when a product is purchased for its usefulness (Hyman, 2011). Retail taxes emerge during transactions. In essence, in the cause of transaction, the buyer acts as a government intermediary.
It would be futile to
carry out representative and encompassing service stipulation to society from
sales tax managed by a federal government. The impact from transferring such a
tax to a central administration would be catastrophic for the national economy
as their would be a lot of mismanagement, inconsistencies, and incongruities resulting
from the transfer of sales tax management to a generally powerful jurisdiction
such as the federal government in Washington, DC. The notion of democracy is
based on the devolution of power and also separation of powers. This system
allows local jurisdictions to craft streamlined systems that make their
operations attainable in a manner that brings in satisfaction in the effective
delivery of goods and services to the population inhabiting in that
jurisdiction.
Transferring local
and sales taxes to a central authority would undermine state development and
lower human progress especially the social and economic sectors that will be
severely impacted by mismanagement ultimately spearheading drastic decline in
the effective delivery of goods and services. The notion of freedom that is
enshrined in the constitution will also be undermined and the general national administration
will be akin to authoritarianism as the state and local governments will be
deprived of the rights and privileges enjoyed previously. There will be
mismanagement of taxes as some states would receive better preferential treatment
than others.
The men and women on
the helm in the central headquarters will be driven by favoritisms and
affection for states inclined to their political ideals and philosophical
thoughts. There is no question that humans have inherent sense of irrationality
and preferences for people of like mind and ideas. Any preferential treatment
of a state over another state would result in massive migration of people
seeking better opportunities and avoiding burdening taxation in their original
areas of settlement. Taxation is a government monetary imposition that cause
reduction to citizen finances and that is why many abhor it altogether.
However, despite citizenry abhorrence of taxation, what is worth comprehending
is the significance taxation has on human progress especially when
jurisdictions resourcefully and effectively deliver goods and services as
demanded without any lapse whatsoever. There are nations on this planet that
are free of taxation. However, people pay more for services such as plethora of
commodities, groceries, insurance premiums, diesel and gas, electrical and
heating utilities, water and garbage collection, school tuition, and other
amenities to supplement the missing taxation.
It would be improper
to tax people and redistribute from a government-managed central jurisdiction.
This would place a strain on the progress of local and state jurisdictions. In
a nutshell, local and state jurisdictions would be unable to make
recommendations to the central authority and as well be unable to design a
formality that would usher in progress and prosperity to their areas of
jurisdictions. On the other hand, the central government would have a hard time
making universally encompassing deliberations on tax dispositions in such an
expansive nation like the United
States
Centralization of
taxation has failed in many authoritarian and dictatorial regimes where hunger
and starvation, abject poverty and underdevelopment are the norm. The decline
of national infrastructure in undemocratic countries results from poor
management of national revenues and other sources of finances. Gross injustices
and political decline visible in undemocratic countries emanate from mishandling
of the overall governing structures that is based on individual philosophical
thoughts as opposed to uniform social deliberations and freedom of choice.
Thus, centralization of taxation is inconsistent with modern governance.
Taxation handled by a
single governing entity would accelerate a decline in people’s purchasing
power. However, since not all jurisdictions share equal resources, the federal
government would be tempted to impose hefty taxation on states and local
jurisdictions that it finds having significant resources. Likewise, the federal
government would put more emphasis on the development of the region having
potential for resource production such as in the fields of petroleum, forestry,
fisheries, industries, education, medicine and pharmaceutical products, and
mineral extraction.
In 2009, the total revenue raised by state governments from sales tax was
30% (Hyman, 2011). Some states depend more on revenues generated from retail sales than
others such as Washington
According to Hyman
(2011), retail sales taxes are the prerogative of local and state government
and never administered by the federal government. This is already an answer to
the question that drives this essay. It was first enacted in New York
References
Bae, S. (2008). Revenue, growth, structure and
burden across state and local revenue sources: The impact of state budgetary
rules. Conference Papers-Midwestern Political Science
Association. Department of Public Administration: San Francisco State
University
Bowen, W.M., Haynes , M.E.
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