Sunday, October 26, 2008

4. Taxing Non-Residents:

According to the UAC study, imposing an income tax on those who live and work in the township would increase tax revenue by $12 million. Mind you, this is really nothing more than a wild guess, because they acknowledge that certain information is not available to determine the accuracy of the income tax impact on the township. But the study specifically says "This shift would transfer costs of city services from property owners, primarily residents, to employed persons, primarily nonresidents, and decrease reliance on a static financing source." The UAC study estimates that 80% of the people who work in Sylvania Township live outside our community, in Toledo, other parts of Lucas County or Michigan.

There are two arguments to taxing non-residents. The first argument is that these workers don't pay for the services that they use while working in our community. They use our roads, our police, our fire, etc., but they aren't paying for it. So why shouldn't we make them pay for those services via an income tax. This argument ignores the fact that their employers pay property tax, which in turn supports our services. Not only is commercial property typically assessed at a higher value than residential property, but commercial property tax rates are higher than residential rates under Ohio law. So, we are being paid to provide services to these 'visitors' to our community, visitors who provide valuable services, goods and knowledge that help our community thrive and grow.

The other argument in favor of imposing an income tax on non-residents is really almost offensive: "They don't vote for us, so why shouldn't we tax them?" Wow, what a statement. And yes, I have heard that exact statement verbalized by more than one city elected official and merger proponent. So, should we tax people just because we can and they can't stop us? I don't think so. Do we really need more money to operate our township government and services? I don't think so. Quite honestly, governments will spend as much money as they can get their hands on. We don't need more just because we can get it. Unless government is constrained in the amount of money it has available, we will find reason after reason to spend what we have.

Bottom line, Government should not tax beyond what is needed to provide services. I don't think we should tax non-residents just because we can or because there is no political fall-out from imposing such a tax.