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AZ: Tax Revolt Worries Business Groups

Some riled up Arizonans are working on property tax cap that appears to go even further than California's notorious Proposition 13. The initiative would rollback assesment values to 2003 and cap all property taxes at 1%, including business property taxes. The proposal is being met with skepticism from the Chamber of Commerce and the National Federation of Independent Business, which both worry that faced with an absolute cap on property taxes that local governments will find other, less economically friendly ways to raise needed revenues. In California, after Prop 13 passed, many municipalities encouraged retail development at the expense of other businesses in order to capture sales tax revenue. And impact fees went through the roof. In other words, as one business representative put it, this is simply bad policy:
"This would devastate local government," said Tim Lawless, president of the Arizona chapter of the National Association of Industrial and Office Properties. "It's not good public policy. You could have draconian impact fees for everything under the sun. Local governments will find a way to replace that money and perhaps in a more regressive way."
There are signs across the country that businesses are increasingly concerned about the overreaches of the libertarian ideologues who were once their allies. From raising money to reform Colorado's spending caps to raising concerns in state after state about hard-line tax-and-spending maneuvers, American business is sending a clear signal that good government is good for business and slash-and-burn politics are a first step down the road of ruin.