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When it comes to taxes, of course, the potential damage includes more families fleeing for the suburbs, more businesses
joining them, and more conventions avoiding Indianapolis for cities that don't pick their pockets quite so cleanly. Moreover, every tax increase aimed at solving one problem makes it harder to solve other problems; so you'd better pick the right problems to tackle.As the city considers a new pair of tax increases to shore up the finances of the Capital Improvement Board, which oversees sports and convention facilities, the ramifications are much broader than the specific taxes involved. At some point, voters will say they've had enough and more problems the city needs to address will go ignored.
The latest debate involves a proposed tax increase that would raise the rate on rental cars
from 15 percent to 17 percent, on top of already hefty airport taxes and fees. A second planned increase would raise the ticket tax for Colts and Pacers games, and other events in city-owned facilities, from 6 percent to 10 percent, on top of high sales taxes.Collectively, the increases would worsen a serious problem in a city that relies on convention business, as Indy already is known for gouging visitors with high taxes on everything from restaurant tabs to hotel rooms to car
rentals. When it comes to tourism taxes, Indianapolis isn't as bad as Chicago. But it's much worse than Louisville, Cincinnati, St. Louis and most other cities it competes against.Meanwhile, this latest idea would affect locals. For a family
of four sitting in the balcony for an Indiana Pacers game, for instance, the plan would add $4.48 to the ticket tab, resulting in a cost of $153.80 before parking and food. It would apply to other events that draw people from around Central Indiana, from the Ringling Bros. circus that just left Bankers Life Fieldhouse to the Justin Bieber concert that will send teenyboppers into a frenzy next summer.With that in mind, a few things are worth considering.
First, Indianapolis is in a new era of competition for Central Indiana's entertainment dollars. The Palladium in Carmel -- filled many nights with concertgoers who once headed Downtown -- should serve as a warning of what happens when suburban residents are offered options that include fewer taxes, better parking and less all-around hassle.
Second, those seeking this tax increase need to prove that they have done everything possible to raise other revenue before turning to taxpayers. So far, they haven't made the case.
Third, more serious issues than the Capital Improvement Board's budget are on the horizon. The city needs to consider how a series of tax increases now will affect a push to increase taxes later for, say, mass-transit or early learning programs. At some point, residents will have had enough. At some point, politicians will balk at raising another tax.
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http://www.indystar.com/apps/pbcs.dll/article?AID=2012212120305&nclick_check=1
