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Next week’s installment of Connecticut’s annual suspension of sales taxes on clothing and shoes may be a reminder that government is very good at bribing people with their own money.
Sales Tax-Free Week is promoted as state government’s special benevolence to families with children about to return to school and in need of new apparel, though for years now any close look at students entering or leaving Connecticut’s middle and high schools has shown that scruffiness is far more fashionable than neatness and is fully approved by parents.
But kids are always growing out of their pre-ripped jeans and needing new ones, so parents buying clothes next week may feel that they are saving a little money compliments of their governor and state legislators.
The feeling is deceptive. That’s because, since money is “fungible” — interchangeable — the real burden of government is discovered less in its particular taxes than in the totality of its spending. With Sales Tax-Free Week state government has not really decided to make a special gift to the people but rather to recover the foregone revenue someplace else.
This is all calculated when the state budget is devised. Government determines how much money it wants for operations in the year or two ahead, and the amount to be spent is not really reduced to cover the revenue lost by the brief and narrow suspension of the sales tax. Instead, state taxes elsewhere are sustained or raised as necessary, or state government relies more on “free” money from the federal government.
Sales Tax-Free Week does not change the real burden of government.
The Connecticut Mirror this week quoted the Institute on Taxation and Economic Policy as noting that even on its own terms Sales Tax-Free Week largely fails as relief for the poor and middle class. The institute says most of the tax relief on clothing goes to wealthier people who can afford to buy more; that sales taxes remain regressive, falling more heavily on people with lower income; and that there are far better ways of providing tax relief to the poor and middle class.
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Either directly or indirectly everyone in Connecticut pays municipal property taxes, which are high, even as most state financial aid to municipalities bestowed in the name of property tax relief is gobbled up by compensation for municipal government employees, achieving little if any property tax relief.
Requiring municipalities to reduce their property tax rates would help ordinary people far more than a week without sales taxes on clothing and shoes. So would reducing the state tax on gasoline or the fees on driver’s licenses and auto registrations.
But cutting other taxes and fees on a long-term basis would be taken for granted quickly, while Sales Tax-Free Week can be presented as a special event of the benevolence of elected officials.
Indeed, if there were any sincere liberals in Connecticut politics, and not just people who mistake subservience to the government employee unions for goodness, they might wonder aloud why, if one week a year without the sales tax on clothing and shoes is good, 52 weeks a year with the sales tax reduced a bit on everything might not be even better; why larger tax reductions generally might not be better still; and why some basic efficiencies now grossly lacking in state and municipal government might not be best of all.
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WHAT ELSE IS IN THERE?: Now that Connecticut knows that former Republican gubernatorial candidate Bob Stefanowski isn’t the state’s only political figure doing business with that awful country (and U.S. ally) Saudi Arabia but that the investment house run by the wife of Governor Lamont, a Democrat, has at least one big Saudi “partnership,” will any of the state’s many politically correct news organizations review the rest of Mrs. Lamont’s extensive portfolio for more examples of political incorrectness?
It would be surprising if there weren’t many.
Or can only Republicans be politically incorrect in Connecticut?
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Chris Powell has written about Connecticut government and politics for many years. (CPowell@cox.net)