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As we talked about yesterday in the post Local Government and Their Lust For Property Taxes, local governments are facing a reduction in property tax revenue. These politicians will not reduce the spending they have on the books unless their is a full blown revolt by the taxpayers. So the only option is to raise taxes elsewhere.

Here are some examples from Financial Week on how government officials are failing to reduce expenses and instead milking the cash cow by taxing their citizens and businesses even more.  

• Wisconsin broke the nation’s longest-running budget stalemate last month by approving, among other things, a $1-a-pack cigarette tax increase while rejecting a proposed new tax on hospitals.
• Meanwhile, the governor in once puritanical Massachusetts is in favor of converting a racetrack in Boston into a full-blown casino.
• And in Chicago, Mayor Richard M. Daley has proposed a fee of 15 cents a square foot on large development projects. The fee could generate about $2 million in revenue next year for the city.
  “This is not a fee on a small interest group,” William Bornhoff, managing director of the Chicago Real Estate Alliance, a developers group, told Financial Week sister publication Crain’s Chicago Business. “This increases the cost of doing business in Chicago.” In addition, a political fight is playing out in Michigan, where Gov. Jennifer Granholm has signed into law new sales and use taxes, the bulk of which would be paid by businesses purchasing services from other businesses.

  The main reason for all these new revenue generators is to help make up for the expected sharp drop in property tax revenue cities face as the impact of the slumping housing market hits home, sending once balanced budgets deep into the red. via Financial Week.

Related posts:

1. Local Municipalities Losing Millions in Property Tax Revenue
2. Governments Look To Suck Money Out of Foreclosured Properties
3. European Governments Attempt Rescue Of Fortis, Hypo Real Estate and B&B
4. San Diego Real Estate Bubble Caused Local Recession
5. Blagojevich’s Wife Now Target Of Real Estate Probe