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Effectively-written Constitutions Matter – Econlib

Jack Young by Jack Young
January 26, 2023
Home Economy

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In the event you learn a lot about taxes and spending within the state of Illinois, that the state’s in a world of damage. The state authorities has dramatically underfunded its pension system for state authorities staff. Someday within the subsequent decade, the federal government will possible must rein in state pensions, reduce the expansion of different spending to give you funds to finance these pensions, or increase taxes.

I’m positive the state’s elected officers will contemplate all of these choices sooner or later. However happily, there may be one main barrier to elevating taxes: the Illinois state Structure.

That is from David R. Henderson, “Constitutions Matter for Tax Rates,” IPI, TaxBytes, January 25, 2023.

One other excerpt:

However that’s not the one benefit. The opposite main benefit is that it makes a legislature suppose twice, or at the least as soon as, earlier than imposing larger tax charges. The legislators know that what’s sauce for the high-income goose can be sauce for the low-income gander. Most individuals don’t like having their taxes raised, however many individuals don’t object to having different folks’s taxes raised. The requirement for a flat tax price on particular person and company revenue signifies that individuals who assist elevating taxes on others know that they will even find yourself being taxed extra.

That’s the place a structure is available in awfully helpful. Below the Illinois Structure, all people should pay the identical price on their particular person revenue and all firms should pay the identical price on their company revenue.

Learn the whole thing, which is brief.

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Jack Young

Jack Young

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