Arizona High Sales Tax Angers Patrons
- Sales Tax News
- Feb 20, 2012 | Susan McLain
Arizona residents are apparently taking out some of their angst about sales taxes on innocent cashiers. As previously reported on Avalara.com, Tuba City has been identified as one of the highest sales tax locations in the nation—after you add in tribal sales tax—and this year’s Tax Foundation report is no different. Vans Trading Co. is located in Tuba City. After more than 60 years in business, “…it’s only in the last decade that customers at the Tuba City general store have yelled at the cashiers after they get their receipts.”
Vans owner, Lucky Mokhcia says, “They just yell at my cashiers. They’re saying it’s too much.” But Mokhcia has no control over sales taxes.
Arizona Chamber of Commerce and Industry spokesman, Garrick Taylor says “[s]ales taxes are … less likely to scare off potential businesses than property and corporate income taxes.” But Arizona Capitol Times reports, “…while Arizona’s sales tax is not necessarily driving away businesses, it could be driving away their customers – or at least driving down sales.”
Kevin McCarthy, president of the Arizona Tax Research Association, states, “[w]e’ve always been heavily reliant on sales taxes,” rather than income or property taxes. A recent Tax Foundation report states that thirty-six percent of Arizona’s revenue comes from sales taxes; 13 percent comes from income taxes, but the national average is 22.9 from sales tax to 21.3 income tax.
McCarthy indicates that residents approve the balance in Arizona as “…polls have shown that property and income taxes tend to be less popular with people than sales taxes, so when Arizona has needed money, that’s where its lawmakers have turned.”
Senior economist Stephen Slivinski, of the Goldwater Institute, expresses that you can have a high sales tax rate and still have a good system but his concern would be that, “Arizona has a tendency to just look at one tax at a time and make policy on an ad hoc basis, and that’s just not good for anybody.”
In the meantime, Lucky Mokhcia’s business hurts. The tribal members who must pay the highest sales tax noted in the U.S., “…don’t shop here anymore,” says Mokhcia, because the town’s people don’t mind driving 80 miles to Flagstaff to avoid the high taxes at home. According to Mokhcia, “This is a low-income community,” and the sales tax rate “…creates a bad situation.”