oldandslow wrote:
There is a positive approach to having several smaller revenue streams to reduce the incentive for tax avoidance.There is another positive aspect in that it doesn't make government revenue highly sensitive to fluctuations in any one area of the economy.
Those states whose revenue depended highly on sales tax experienced a lot of drama during the Great Recession as sales volume decreased but government expenditures remained relatively constant (or even increased with jobless claims). Those that depended on a mixture of property tax, income tax, and sales tax tended to have smoother sailing.
(I have no proof of this on hand, but have read it in several places.)