Question: In 2008 the sales tax in Cook County Illinois was
In 2008, the sales tax in Cook County, Illinois, was doubled. One journalist speculated that the tax increase was enacted because government officials sensed that the tax base was more captive than usual, since falling real estate prices and a tough job market made it difficult for citi-zens to move. Examine this situation through the lens of optimal tax theory. Is the increase in the sales tax efficient? Is it fair?
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