Greg Mankiw's Blog: Tax Competition and the Core of Justice

Time for a Dallas County Tea Party

Want to know one reason why Iowa's a rough place for small business? For one, we have so many different taxing districts, it'll make your head explode. Try to sell anything in this state, and you'll practically have to apply differential calculus in order to figure out how much to charge the customer.

Now, the folks at Project Destiny want to make life even more complicated for Des Moines residents by hiking the sales tax here by another percentage point. But wait -- there's more! Thanks to the muddling of the state Legislature, this is a special taxing district that could include three counties, not just the city of Des Moines.

But here's the real rub: Approval will only require a majority vote of the total population among all three counties. In other words, if everyone in Dallas County just stayed home on the day of the vote, they could still have the tax imposed upon them by voters in Polk County and Warren County...completely without their consent. Taxation without representation was never so clear.