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If we're looking to avoid volatile revenue streams, we should also avoid income taxes. But that's not really a starter, is it? http://taxfoundation.org/blog/new
by civilian 11y ago
If we're looking to avoid volatile revenue streams, we should also avoid income taxes. But that's not really a starter, is it? http://taxfoundation.org/blog/new-sp-report-shows-income-taxes-are-volatile-sales-taxes-need-reform http://taxfoundation.org/blog/new-sp-report-shows-income-tax...
A better solution would be to have a budget that accounted for potential volatility, and specified where surpluses should go, and where things should be cut from if revenues are down.
- eru 11y agoDon't governments have the ability to go into debt for exactly that stabilizing function?
- civilian 11y agoYes, but wouldn't it be way better to make them honestly try to balance budgets, rather than knowing they can always over-run and kick the can down the road?
- YokoZar 11y agoState governments generally do not without some creative accounting. Most states have "balanced budget" requirements, although they're allowed to issue bonds - provided said bonds are specifically earmarked for specific programs, and in some cases approved through a separate process like a referendum.
- saryant 11y agoSome states also have rainy day funds they can tap into if they have an unexpected revenue shortfall.