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Gosh would that ever be a destabilizing force on American cities. Right now, from a municipal funding perspective, homes with children are revenue negative, homes without children are roughly revenue neutral, office/industry is profitable, and retail is VERY profitable. (all this is before you take into account tax incentives for relocation/retention.) Why will cities fight over a mall, or a car dealership, or a corporate headquarters? A mall draws in shoppers from far beyond municipal borders and the (local part of the) sales tax stays with the physical location. When you pay tax on a new car, you're paying multiple years worth of sales tax on driving in one go. If you buy a car in a different city than where you live, it's like if you shopped in that city every single week for the entire time you own the car. Offices are the same as malls in that they draw from beyond municipal boundaries. If all of a citizen's sales taxes went to the city they lived in, as opposed to where they shopped, then you'd see local (or at least small scale, localized) commerce boom because no city would want to deal with the traffic, road construction and maintenance costs, etc that come with huge retail developments. Dude, this is blowing my mind. This will be a blog post soon. |