A Demonstration of Economic Freedom
We at the Club for Growth always maintain that the remedy for chronic budget deficits is to reduce spending and increase economic freedom.
It is not often that we can point to a clear-cut example.
Today in our headlines we linked to this story form the AP:
The city of Lancaster in central Kentucky has received about $45,000 in new revenue from so called "sin taxes" a year after voters approved alcohol sales. The Danville Advocate-Messenger reported that Lancaster expects to take in $150,000 from the 2.25 percent tax on liquor and 3.25 percent tax on alcohol by the drink by the time the fiscal year ends June 30.
Lancaster Mayor Don Rinthen says the money comes from new restaurants and stores taking advantage of the now-legal alcohol sales, but that the money was never intended to be a savior for the local economy.
While we are not advocates of specialty taxes, here is a clear example of how greater freedom for citizens increased commerce which, in turn, generated government revenues.
Now Lancaster has a real opportunity to use this new revenue to offset and reduce other taxes, making the city even more attractive to job creation and multiplying the impact on economic development....right?