Should sales tax pay firefighters?

Published 12:00 am Tuesday, February 4, 2003

DEAR EDITOR: No one likes sales taxes, but we pay and shrug our shoulders. After all, it’s just a few pennies, isn’t it?

Over the years, the sales tax rate has crept up slowly, a half-percent here, a quarter-percent there. Now, the current rate is 8 and one-half percent, and we’re being asked to add another quarter-percent to provide our volunteer fire-fighters with salaries.

No one can argue that our fire-fighters don’t deserve to be paid for the necessary and valuable services they perform. Of course, they do. But should funding come from yet another sales tax increase?

As an illustration, let’s follow one of the dollars from your pocket as it goes through some normal, everyday transactions.

You go to a convenience store and spend a dollar. Your dollar generates eight and a half cents on the spot. That’s a pretty sizeable bite. Many of us have money invested that doesn’t earn that much in a year, but it doesn’t stop there, not by a long shot.

What happens to your dollar after that? The store owner spends it again, and it generates another eight and a half percent. Whomever receives the dollar doesn’t keep it long. That dollar gets spent over and over again.

It doesn’t take a rocket scientist to figure out after 12 transactions, your dollar has generated $1.02 in sales tax (12 times 8 and one-half). That’s right, in the time it takes for your dollar to change hands 12 times, it generates more than its face value in sales tax, and that’s not counting all the other taxes your circulating dollar generates.

And it’s not just cash dollars in circulation we’re talking about. It’s checks, credit cards, electronic fund transfers, etc. How long does it take for your dollar to change hands 12 times? If the rate at which dollars leave my pocket is any indication, then the answer is not too darned long.

Thirty days? Many would say it doesn’t take that long, but for the sake of this illustration, let’s say 30 days. That mean every month ALL the money in circulation winds up as sales taxes! Isn’t that enough? Shouldn’t our state and local governments be able to make do with getting all the money in circulation every month?

To sum up: Yes, our volunteer firemen should be paid. No, we shouldn’t be asked to pay another quarter percent sales tax to finance it.

John Young