A recent Wall Street Journal Article, "Stockholm's Syndrom," (August 29, 2006, page B1, unavailable without subscription), chronicled Stockholm's efforts to manage car traffic using variable tolls based on the time of travel. Not surpringly, commuters changed their travel patterns.
The Mining Excise Tax
The next installment of the "Hidden Tax/Fee of the Week" is available on the MHPC website.
Total Hidden Taxes/Fees to Date: 261
A new Harvard Study shows that taxes substantially affect taxpayer behavior.
Two new Maine rankings have come to my attention. Neither bring good news to Mainers.
Recently, The Maine Heritage Policy Center (MHPC) released a Maine Issue Brief ™ titled An Update of Maine’s State and Local Tax Collections, written by J. Scott Moody, vice president of policy and chief economist at MHPC. The report partially updates and expands a previous report by the Maine Heritage Policy Center, The Maine View, Vol. 4, Issue No. 1, showing Maine’s level of S&L taxation from FY 1958 to FY 2002.
The new data revels that Maine has yet to reverse the trend of high state and local taxation. Since FY 2002, Maine’s level of state and local tax collections grew 2.1 percent—from 12.8 percent to 13 percent of personal income.
“The level of taxation that Mainers bear continues to grow,� state Scott Moody. “The new data released by the U.S. Census reinforces the increasing trend of high taxation in Maine.�
As the U.S. economy has been recovering from the 2001 recession, there has been a growing level of chatter in the media about the "rich getting richer and the poor getting poorer." To reach this conclusion, these reports rely on "income distribution analysis" that uses income data published by the Internal Revenue Service. As a result, these studies are really examining the distribution of tax returns and not of individuals. The problem is that tax returns are vastly different from one another and not controlling for those differences can lead to erroneous conclusions.
