In a message dated 8/19/2003 9:40:09 PM Eastern Daylight Time, "Jim Mork" <[EMAIL PROTECTED]> writes:
> The fact is we could fun all our shortfalls by simply raising property taxes on business. Any harm in that?< It depends on what you call harm. It's a basic rule of economics that businesses don't really pay taxes; they are factored into the cost of doing business and passed on to the consumer as higher prices. If you're a manufacturer, you can always move to a locality with lower taxes; witness the large number of former Minnesota businesses which have relocated to Sioux Falls (and SF is constantly encouraging others to move as well). If you're running a business that must needs be here, such as a Subway sandwich store or perhaps a retail distributor of auto parts, then, you raise your prices--which you can do because presumably your competition has to pay the higher taxes as well. Of course, the prices will eventually rise to the point that folks will drive elsewhere to shop--say to St. Paul, which doesn't need to raise taxes every year. That means St. Paul gets the sales taxes from the purchase, too. So, the Minneapolis business closes, people are laid off, the building sits vacant, and the property tax assessment is lowered because of the high commercial vacancy rate, so you don't get the higher property taxes anymore. But there's a bright side! The city can then borrow money to create a Tax Increment Finance district because the area around the business is "blighted", and we can subsidize some large corporation coming in to take on the property. The locally owned and operated businesses are gone, but hey, that's a small price to pay. Now that the city has borrowed money to do this, we'll have to raise property taxes in order to pay it back . . . um . . . what was the question again? --M. G. Stinnett Jordan Neighborhood TEMPORARY REMINDER: 1. Don't feed the troll! Ignore obvious flame-bait. 2. If you don't like what's being discussed here, don't complain - change the subject (Mpls-specific, of course.) ________________________________ Minneapolis Issues Forum - A City-focused Civic Discussion - Mn E-Democracy Post messages to: mailto:[EMAIL PROTECTED] Subscribe, Un-subscribe, etc. at: http://e-democracy.org/mpls
