Cash-starved cities and states across the country are starting to weigh whether to raise taxes on homes, cigarettes, local businesses and global tech giants, hoping to rake in new revenue that might help them close the massive budget shortfalls created by the coronavirus pandemic, the Washington Post reported. The increases that have been proposed — and in some cases adopted — reflect growing desperation on the part of government leaders nationwide. Many have found that recent spending cuts, furloughs and layoffs have not been enough to shore up their sagging finances, forcing them to consider more politically noxious and economically risky moves in the middle of an economic crisis. Philadelphia increased fees on parking and raised wage taxes on workers who reside outside the city. Chicago Mayor Lori Lightfoot (D) said this month she could not rule out a property tax increase to cover her city’s $700 million budget shortfall. From New York to Seattle, other states and municipalities have considered a wide array of prospective rate hikes in response to major drops in once-reliable sources of income — and months of failed attempts to get Congress to authorize more federal aid. Nashville leaders even took the eye-popping step in June to increase property taxes by about 34 percent, a move meant to help pay down rising public education costs — and one that quickly sparked a public outcry. The city’s rates had long been historically low, according to Bob Mendes, an at-large member of the Nashville Metro Council who helped craft the budget blueprint. An increase helped pave the way for the city to close an anticipated $216 million financial hole in the 2021 fiscal year without severely hamstringing much-needed public services, he said.
