The Inconvenient Truth About Tax Holidays and Magnanimous Politicians

A number of states are about to “celebrate” a special occasion: so-called tax holidays, which politicians tell their respective voters are great times to get out there and spend money and avoid sales taxes. (RELATED: Democrats Creating an IRS ‘Army’ – Larger Than Pentagon, FBI and Border Patrol Combined)

Just so long as you buy the appropriate, government-approved products. And for a limited time only.

To be fair, tax holidays allow politicians to look like they are giving people something really useful – a tax break. It allows the pols to seem magnanimous, fair-minded and just a little bit like Santa Claus. (RELATED: IRS Job Posting Requires Use of Deadly Force)

But are tax holidays all they’re cracked up to be? Hardly. As the Tax Foundation notes, these schemes are bad policy that distorts markets and complicates taxation. Which is 100 percent on-brand for the political class. What should politicians do if they genuinely cared about good policy and fair taxation? Drop the gimmicks, for starters. And admit that resorting to gimmicks means the state has much bigger problems with its tax code:

If a state must offer a “holiday” from its tax system, it is an implicit recognition that the tax system is uncompetitive. If policymakers want to save money for consumers, they should cut the sales tax rate year-round.

There it is – simple, fair and above all honest. True, a broad tax cut doesn’t allow pols to issue press releases highlighting their generosity. But that’s utterly beside the point. Rather than a temporary tax “holiday,” make the reductions permanent…and let the taxpayers enjoy the benefits for all their purchases, all year long.

The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.

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