CONTENT:
SHOULD MINNESOTA INTRODUCE TAX ON CLOTHING?NameName of InstitutionName of ProfessorDate of SubmissionContents TOC o "1-3" h z u Thesis PAGEREF _Toc354818644 h 3Only General-use Clothing Exempted PAGEREF _Toc354818645 h 3Avoiding Discriminatory Policies PAGEREF _Toc354818646 h 4Increase in Revenue and Reduction of Budget Deficit PAGEREF _Toc354818647 h 4The State is at a Competitive Disadvantage PAGEREF _Toc354818648 h 5Sales Tax of Clothing will meet Tax Policy Criteria PAGEREF _Toc354818649 h 6Conclusion PAGEREF _Toc354818650 h 8ThesisIt is estimated that the sales tax exemption on clothing costs the State of Minnesota about $300 million annually and it is noteworthy to highlight that for several decades now, the State has not has not had sales tax on clothes and has remained among only 8 states in the US that do not have a sales tax on this product according to Janssen (2011). This means that to an extent, the state has remained fairly competitive and attractive compared to other states that do not have sales tax and therefore leading to more tourists from within and outside the state who come to seek more for the dollar when it comes to clothing. However though, Minnesota general sales tax remains one of the highest among the US states and this raises a debate on whether the sales tax on clothing can be applied and the revenue used to subsidize the overall tax rate and effectively making purchases cheaper for the common Minnesota citizens. This essay seeks to explain why a move that would install sales tax on clothing would be wise and a step toward the right direction. An analysis of other arguments that seek to retain the status quo (zero sales tax on clothing) shall also be done and the possible outcomes weighed against the possible outcomes of the proposals of this essay.Only General-use Clothing ExemptedThe department in charge of application of tax has describes the clothing to beexempted as any apparel that is designed for general use such as coats, lab coats, neckties, panties, shirts, blouses etc.This effectively leaves out apparels such as fur clothing, protective clothing (such as steel boots and gloves), clothing accessories (for example wigs and weaves) and recreational or sports clothing and equipment such as hairclips and pet clothing which fall under the taxed bracket. This can raise a number of fundamental issues in the classification of these clothing seeing as different citizens are ascribed to particular clothing.Avoiding Discriminatory PoliciesFirst and foremost, due to the different tastes and preferences in human beings there should not be such a classification because this can be termed as discriminatory. Preferences are not only limited to things such as food and environment for example and therefore clothing remains a commodity that people will always have different tastes in. Take for example a man who prefers to take part in sports and therefore chooses sports as a way of life and effectively adopts a lif...
Should sales tax apply to clothing in Minnesota?