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Old 05-15-2002, 05:45 PM   #1
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maybe i seem stupid for not understanding this, but...

generally, if a state has no state income tax, the sales tax is higher, right? and if the state has a state income tax, the sales tax is lower? at least i've been under that impression.

here in tennessee, sales tax is a whopping 8.25%, but we have no income tax. although the state government wants to change that. i wouldn't mind, but they're not even mentioning about our high sales tax or saying that'll go down to like 5% or so. anything would be better than our almost 10%. in fact, the state wants to raise it to 10% to make it "easier!!!"

today in tennessee, people went outside the state capitol in nashville to protest this. the reason they want this to happen is because our state's finances are in trouble. but is this really right?

i should also mention that the city i live in is about 50% annexed into memphis city, one of the nation's 50 worst school districts. the part i live in is the last section to be annexed, then they'll move on to the rest of the suburbs. memphis city's mayor, willie herenton, is intent to rid the state of shelby county altogether. but it's not the shitty state (haha, no pun intended, if it is one) of the city of memphis that has me mad. it's the fact that us who are annexed will pay city AND county taxes!!! all this on top of an income tax now?

oh, and one more thing...this area has shitty priorities. we managed to sell enough bonds to be able to construct a new arena for the grizzlies team, but we can't afford to contribute to getting the state out of debt?

can anyone give me some insight on to how the hell this could happen? thanks ooh and sorry about how long this is!
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Old 05-15-2002, 09:38 PM   #2
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Obviously, there is going to be more organized, vocal OPPOSITION to a new state income tax than there will be in SUPPORT of one. I think Governor Sundquist and others in your state have valid reasons to establish an annual income tax (such consistent funding would be a better funding base for state and local budgets, obviously, and the harsh impact a sales tax can have on lower income brackets is always going to be a moral lightning rod), but I also think the government should be willing to give a little in terms of the sales tax rate. You mentioned a current sales tax rate of 8.25%; do local and county governments add to that? If so, it is probably already at or above 10%. Also, I remember a proponent of income tax from your state saying most people would pay LESS overall with the income tax, so there would have to be a reduction of tax rates in other areas for that to be true.

I didn't see you mention property taxes; does Tennessee have these? We have them in Alabama, although they are generally VERY low, depending on what community you live in. We have annual income taxes which are not excessive in my opinion. We also have corporate income taxes, oils & gas royalties, etc. So basically, they hit us EVERYWHERE but usually in small amounts, and from a tax standpoint, it is generally pretty cheap to live and do business in Alabama; just don't get sued in the Black Belt region by a local plaintiffs' attorney.

I think our statewide sales tax rate is about 1.5% to 2%, then the local governments add on their share. Some unincorporated county areas are as low as 5% (TOTAL, state included) while some cities and large suburbs are as high as 8-9% total.

The problem here in Alabama is on the spending side: our governments at all levels don't make our dollars go as far as they should. I have always felt that Tennessee does a better job of that. However, most everyone I know here in Alabama grew up in public schools, while most people I know from Tennessee went to private schools in the Nashville or Chattanooga areas. My hope is that our new corporate clients such as Mercedes, Honda and Hyundai will get involved and work towards better spending on education and such. We'll have to see.

Regarding Mayor Herenton's imperialism, is he trying to go for the whole "consolidated" scheme like Nashville and the metro area has? I can see where it would be more appealing in Nashville than in one of the "50 worst" school districts. I would be cautious of that. The trend in Birmingham has been for suburbs and small communities to INCORPORATE so that Birmingham CANNOT seize them. Based on Birmingham's past inablility to do well with its education dollars, I don't blame the suburbs for doing this.

~U2Alabama

[This message has been edited by U2Bama (edited 05-15-2002).]
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Old 05-16-2002, 06:25 AM   #3
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I don't understand your system at all Khanada. You pay so little in tax, it's quite amazing. Here we pay currently a 10% GST, basically anything that is goods (exception fresh food) or a service. Income tax on a full time wage starts at a princely 31.5%. We are taxed at every turn. Do we have debts? Yes any state, any government level does in some way I think.
Comparitively, with you guys paying so little, where does your state get its money from?
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Old 05-16-2002, 09:51 AM   #4
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Quote:
Originally posted by Angela Harlem:
I don't understand your system at all Khanada. You pay so little in tax, it's quite amazing. Here we pay currently a 10% GST, basically anything that is goods (exception fresh food) or a service. Income tax on a full time wage starts at a princely 31.5%. We are taxed at every turn. Do we have debts? Yes any state, any government level does in some way I think.
Comparitively, with you guys paying so little, where does your state get its money from?
Angela it sounds like you are Canadian, so I hate to call you on a couple of points...but some of them were a little off..

GST (or at least as I paid it last night at Crappy Tire..lol) is 7%, and some provinces tack on an additional provincial sales tax. In Ontario the sales tax is 8% so you end up paying an additional 15% in total.

For income taxes, the federal income tax starts at 16% for net incomes $30,754 or less, goes up to 22 and 26% based on net income, and finally maxes out at 29%. Of course you then need to add provincial tax, which in Ontario is 6.16% on the first $30,000, maxing out at 11.16% for net incomes over 61,000. In Ontario though your net tax rate can be lower if you earn a modest income and yet rent for your lodgings as typically a year's rent adds up to a nice little provincial tax credit.

So potentially you could pay as little as 16 to 22.16% if you earn less than 30 grand, and as much as 40% if you earn over 100 grand.

Mind you, it still sucks, as after all that tax paying is said and done, with your disposable income you still have to fork over 15% of it when you buy something.

We are taxed to death up here, but I suppose we get it back in other ways...



[This message has been edited by gabrielvox (edited 05-16-2002).]
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Old 05-16-2002, 09:54 AM   #5
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Angie is Aussie, if I'm not mistaken.
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Old 05-16-2002, 10:10 AM   #6
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Originally posted by sulawesigirl4:
Angie is Aussie, if I'm not mistaken.
DUH! Silly me, must have been my Canadian egotism that would lead me to believe that only a country like Canada would be overbearing enough to add an additional burden of GST onto its already overtaxed citizens..

((runs and hides from Angela, embarrassed))


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Old 05-16-2002, 12:37 PM   #7
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Quote:
Originally posted by U2Bama:
You mentioned a current sales tax rate of 8.25%; do local and county governments add to that?
i believe the 8.25% is including any local and county additions, since that's all i pay for stuff here. i'm assuming it varies from area to area, if there's any other tennesseeans (sp?) who don't live near memphis here, maybe they can verify this.

Quote:
I didn't see you mention property taxes; does Tennessee have these?
ooh sorry, yes we have these too. i'm not sure on the percentage though, i could ask my mom later, though. so, once the annexation happens i think we'll pay property taxes to both city and county. what i do know for sure is those who've recently been annexed, their property value has decreased. ours has been in steady incline because of the development of this area over the past 5-6 years. we always seem to move to cities that suddenly get super developed, a curse and blessing.

Quote:
Some unincorporated county areas are as low as 5% (TOTAL, state included) while some cities and large suburbs are as high as 8-9% total.
yeah, that's the problem. since i live in one of the three biggest cities here, i don't know the varying rate. the last time i bought something when i wasn't in memphis, i was in mississippi so i don't really know.

Quote:
The problem here in Alabama is on the spending side: our governments at all levels don't make our dollars go as far as they should. I have always felt that Tennessee does a better job of that. However, most everyone I know here in Alabama grew up in public schools, while most people I know from Tennessee went to private schools in the Nashville or Chattanooga areas.
city and county governments spend their money differently, i think. in my opinion, the county spends more on education, while the city focuses more on, for example, roads. one positive thing about city is you get lights on the sides of the road. on my street this is great since we have kitties walking around at night, and sometimes you don't see them until you have to slam on the brakes. but luckily i've never hit any. however, we still have about three schools in the city *without* air conditioning. these schools go all the way into july because of all the half days they have to have since it's too hot to go to school after noon.
but anyway, most of the people i know go to public schools around here, be it city or county. in my area, there's only two private schools, and you have to have grade criteria met (no C's).

Quote:
Regarding Mayor Herenton's imperialism, is he trying to go for the whole "consolidated" scheme like Nashville and the metro area has? I can see where it would be more appealing in Nashville than in one of the "50 worst" school districts. I would be cautious of that.
yes, he's trying to consolidate. his goal is to, one day, make all of shelby county = memphis city. if he didn't have such a poor track record in my eyes, i wouldn't mind. but given how bad memphis city schools are (although i graduated high school in 5/01 and plan moving once i graduate college, this stuff makes property value, etc. decrease) and his overall "holier than thou" attitude, i don't want this at all. and neither do a lot of people. however, it seems that there's nothing we can do about it. herenton is a pompous asshole, he didn't even let memphis citizens vote on whether we wanted a new arena or not! he just did the okay and talked about an increase in taxes to pay for the nba arena. my thought was, why not just renovate one of our current arenas? i would think it would be cheaper. but i guess he has to have the sparkly brand new stuff.
the only positive thing i can think of is i can try to vote herenton's and rout's (county mayor) asses out of office come november. i used to like rout but since he's not kicking up a fuss about the annexation since he's still getting his tax dollars...grrrrr.


*edit* had to fix a ubb code error

[This message has been edited by KhanadaRhodes (edited 05-16-2002).]
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Old 05-17-2002, 03:26 AM   #8
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lol Gabriel, you weren't to know. I guess every country has a Boondocks? hehe. Thanks Sula

Who coined the phrase, the only certainty in life is death and taxes? Bah. What you gain on the straight, you lose on the roundabout.

A teacher once was comparig Aus to other coutries and their tax systems. He said that Sweden I think it was, pay something whopping like up to 50-70% income tax, but they are fully supported by the state with health and retirement funding. Apparently citizens can retire in their 30's on around I think 70% pf what they used to earn. Does anyone know any of the details of their system?
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