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What is Equality?
By Bryan CathermanWhen thinking in terms of funding public goods— most often in the form of taxes— there are two ways to think about equality. The first is that every citizen, regardless of wealth or other factors pay the same. The second is based on wealth value. Is one fairer than the other is? Debate will never answer this question. Is one more “right” than the other? Well, that might depend where a person resides on the wealth scale. It may also depend on political persuasion.
Case in point—Herriman, Utah. Mayor Crane and the city counsel recently created a $25 per month service fee to fund 2.5 deputies. Any resident or business that pays a water bill pays this fee.
Mayor Crane holds that this fee is fair, more so than the “most unfair form of taxation” we know as property tax. A notice that came with the water bill reads: “The basis is that a user fee does not include the inherent inequities included with the imposition of property tax. Everyone in the community uses the public safety services funded by this fee: property owner, renter, resident, or commercial service provider. The burden is equally shared by all residents.”
Crane estimates that a property owner will pay $188.20 annually per every $100,000 of property value. (Even though renters don’t normally see the tax bill, it’s passed on through rents. They pay taxes in a roundabout way.) On top of this tax, the monthly $25 fee is added. That’s $300 per year. A homeowner with a home valued at $100,000 just had their burden for Herriman public goods more than doubled. At $200,000, it’s almost doubled. For a person with a $500,000 property (who likely has additional tax shelters), the increase is only a third of their normal tax burden. Does this seem fair? The burden might look the same in dollars but it weighs heavily on some, where as it’s a much lighter burden for the wealthy.
In addition to the equality argument, Crane argues that everybody uses police services. I can agree with that argument, but some people use these services more than others. Shouldn’t they pay more? What about services that not everybody uses—surely it can’t be fair that everybody pays for services that not everybody use, right? I don’t have a child in school, so under this argument I shouldn’t have to pay for that public good. Maybe the public schools should charge admission at the door. It could be the same fee for everybody regardless of social-economic status. Let those that use the service pay for it rather than making property owners bare the burden of pubic school with the “most unfair form of taxation.” I don’t agree with this argument, but Mayor Crane may. In a way, he does in regard to the 2.5 police for $25 per month per household or business.
While arguing that everybody should pay the same dollar amount because that’s fair, the second argument is that everybody paying the same parentage is also fair. Twenty-five dollars to a person with a $20,000 annual income is a much larger portion of their income than for a person with a 6-figure income. So what is fair? What is equality?
Posted by catherman on September 10, 2006 07:53 AM
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