Some states are lowering local taxes, while others are raising them, and it's causing some rather alarming rifts and divisions. The middle ground is quickly disappearing. In 2006, 15 US states had top income-tax rates on wage income below 5%, and just one exceeded 10%. Now, more than half of the US states have gone below 5%, and 5 others, plus the District of Columbia, are in double digits. 

Is the US in the midst of a Taxation War? Some states with lower local taxes are doing everything in their power to berate others with higher taxes to attract those people to move to their state. And it's working. The migration patterns fueled by COVID are only matched now by the migration patterns triggered by tax-fueled thinking.

Low local state tax US states do not automatically have a lesser quality of life; many are growing rapidly due to lower costs and warm climates. However, they often rely on regressive sales and/or property taxes, creating higher costs for lower-income residents and potentially leading to less funding for public services like education and infrastructure. Growth can offset lower taxation revenues. Sometimes, additional revenues are created via other areas:  natural resource taxes, tourist taxes etc. 

Lots of the local tax increases stem from reduced Federal spending in areas.  Most taxes that are reduced or removed have to be made up for elsewhere unless you cut out services or don't raise wages. Yes, cutting inefficiencies and waste should always be a priority, and too often ignoring this fuels anger and the need for more revenues. Cities, towns, and states are not immune to higher inflation and interest rates.

The extremes are painful: zero local taxes or extremely high local taxes are not the answer. Somewhere in the middle (efficient and effective spending combined with realistic taxation that does not punish one group at the expense of others), must lie the solution. The problem I see is how this issue has become a driving force of so many narratives, often distorted or downright falsified to fuel that narrative or political ambitions. 

The past few years have highlighted blatant corruption and inefficiencies of governments, massive retirement funds for government employees that differ dramatically to the private sector, and a huge workforce. Millions of government buildings' square footage is unused, etc. Rarely do we see or hear about a government agency or initiative that is truly cost-effective and delivers tangible, good results even when they do. The abuses seem to be the only bi-partisan aspect of this issue, with each side claiming moral superiority while either spending more or cutting more, while simply shifting that cost burden onto someone else. The costs to do or buy anything are sharply higher in some areas than others and so too are the incomes.

Local taxes pay for many essentials. Could those be paid for directly, bypassing the bureaucracy and waste of government? Should those genuinely unable to take care of themselves be left to fend for themselves? Local taxes (primarily real estate taxes) fund essential community services such as public education, local police and fire departments, road maintenance, public transit, libraries, social services and parks. They also support sanitation, public health services, and local administrative functions. How do those items get paid for? Someone, sooner or later, will have to pay for them if we wish for a civilized society. Maybe it's time to figure this out collectively, wisely and calmly, together, instead of constantly pitting people and states against one another?