Stokes on the Sales Tax Pool
Over at our main website, David Stokes has a new article on a proposal to abolish the sales tax pool in Saint Louis County. In short: he thinks it’s a bad idea:
The current system acknowledges the fact that most shoppers going to the Galleria don’t live in Richmond Heights. It also benefits the business environment in our area by rewarding non-retail economic development. If Webster Groves attracts a new corporate headquarters, that would clearly generate significant new sales taxes for the area based on the new jobs and employees brought to the region. Why should a neighboring A city with significant shopping, such as Brentwood, keep all of the sales taxes generated within Brentwood by the new employees of that Webster Groves company? Eliminating the pool contributions of A cities would further press all cities to search for ways to increase sales taxes and grow retail development at the expense of other modes of the economy, such as finance and manufacturing, which generate the salaries used to go shopping in the first place.
That pressure to increase the retail economy, as opposed to other types of development, is one of the main reasons behind the eminent domain abuses we have seen in recent years in Saint Louis County. It is not a coincidence that all of the controversial eminent domain actions in Saint Louis County have occurred in A cities such as Sunset Hills, Manchester, Rock Hill and Clayton. Residential areas such as the one at issue in Sunset Hills have more tax value to B cities, where a city’s population is a significant factor in the amount received from the pool.
It’s a great article, so you should click here to read the whole thing.