In light of the spate of recent budget shortfalls caused by a litany of ballooning expenses, state
governments can no longer afford to maintain their tax systems at the status quo and hope that
enough revenue will come in to avoid collapse. This study seeks to identify not only which
states have been most successful at raising revenue, but what methods they have used to do it, in
order that other states might gain from that knowledge. Beginning with the position that a sales
tax is the best tool available for states, the study evaluates quantitative regression analyses of the
taxes levied by each of the fifty states from 1961 to 2010 and the resulting revenue those taxes
brought in. By making the historical data the subject of the study, instead of merely an input,
this paper fills a gap in the current scholarly literature on the topic of state revenue that has
sought too often to project questionable assumptions into the future instead of learning from the
past. The results of such an analysis will highlight the most successful ways states have been
able to keep their coffers full. The study aims to provide a resource for state policymakers who,
in many parts of the United States, face a ticking time bomb of future expenditures.
Chasing the Magic Bullet: What Strategies do States Use to Bring in Revenue.
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