how do Federal and state laws limit the ability of local government to raise revenue

Tax and expenditure limits (TELs) restrict the growth of government revenues or spending by either capping them at fixed dollar amount or limiting their growth rate to match increases in population, inflation, personal income, or some combination of those factors. As of 2015, 28 states had at least one TEL.

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ayfat23 ayfat23 · Answer 2 · 2022-04-20T12:56:12+02:00

Federal and state laws do limit the ability of local government to raise revenue by issueing Tax and expenditure limits.

What is Tax and expenditure limits?

Tax and expenditure limits serves as the restriction measure that reduce the growth of government revenues or spending.

This restriction is usually placed on the local government to match increases in population with growth rate which has negative effect on internal revenue generation.

Therefore, Tax and expenditure limits reduce the growth of local government.

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