EDITORIAL: Strange proposal from a Democrat

According a July 22 editorial in the New Era, Commissioner Craig Lehman, a Democrat, has proposed a 1% county sales tax with the funds to be applied to reducing county real estate taxes.

Traditionally, the more affluent Republicans favor such a regressive tax because, proportionate to incomes, it falls far heavier on the poor and lower middle class than on the more affluent. Democrats prefer a property tax because, although everyone pays it either directly as an owner or indirectly as a renter, it is progressive in that those who are more affluent tend to live in more expensive residences.

(Economics 1A: Items subject to sales taxes take a much smaller percentage of the revenue of the better off than the worse off.)

But apart from the issue of social equity, there is a huge practical reason not to adopt a sales tax. When New Jersey sought to assist blighted areas, it lowered its state sales tax to induce retailers to set up stores in the targeted area. By the same logic, raising Lancaster taxes above surrounding counties would discourage both retailers and shoppers.

And it certainly would be an impediment to attracting conventions and hotel guests for the $200 million convention center project!