Reference no: EM132649849

Scenario:

The city leaders of Lawsona suffered a budget shortfall last year. In their planning for the new fiscal year, they feel they can raise the needed revenue by imposing a sales tax on the consumption of the citizens of the community. They are particularly entranced with the possible tax revenue that can be gained from a redeveloped mall in the center of the city. The mall, a joint project between the city and a developer, was rebuilt from the ruins of an abandoned shopping center that had been an eyesore for many years. The new mall serves many of the inner city residents who rely on public transportation and live either below or at the poverty line. The mall has been a huge success and has been hailed as the vanguard of a new revived downtown shopping area. A sales tax, however, would impact to a greater extent the many low- and middle-income shoppers who shop downtown, for they would pay a greater percentage of their income to this tax than wealthier shoppers.

Respond to the scenario, and discuss if the sales tax is a good or bad move for the city of Lawsona. Make sure to clearly state your stance on the situation, and explain in detail your reasoning behind your decision. Support your opinion with concepts from this unit's reading.