Sales tax tourism

When I lived in Nevada, paying taxes was not only was fun!

Whenever I got the urge to pay state income tax, I drove to any one of hundreds of Nevada's tax collection centers (AKA casinos).  While I paid my taxes I enjoyed free drinks and was allowed to smoke.  If I paid enough tax, I got a free buffet out of the deal.  Then there were those times when I left with more money than I arrived with!  And if I didn't feel like paying, I could just sit at home while Californians paid tax for me.

Now I live in Illinois.  They call it the "Land of Lincoln" because you can't back out of your driveway on to a pothole-infested road without Governor J.B. Pritzker wanting five bucks.  Illinois liberals think taxation is a substitute for proper financial planning.  They are wrong.

Missouri legalized recreational marijuana back in January.  In Illinois, J.B. Pritzker was shocked by the unexpected plunge in tax revenue from marijuana for Q1 of 2023.  He ran around Springfield like Dr Fauci at an adult sudden death syndrome conference scratching his head and asking "why?"  Why, indeed.

Illinois is a pretty narrow state, and most of the residents live within an hour's drive of a major out-of-state shopping area like Kenosha, Dubuque, Davenport, St. Louis, Cape Girardeau, Paducah, Evansville, Terre Haute, or Gary.  At almost all of the border towns, economic activity is always larger in the town that isn't in Illinois, the only exception being Chicago and Gary/Hammond.

If you drive by any dispensary in Eastern Illinois, you will notice that about a quarter of the license plates are from Indiana or Kentucky.  If you drive by a dispensary in Eastern Missouri, you will notice that about half the plates are from Illinois, with a few Indiana and Kentucky in the mix.

Back in December, East St. Louis had a ton of billboards advertising dispensaries in Illinois.  Now the billboards and the dispensaries are gone.  It looks like highly taxed legal weed, empty casinos, and on-demand abortion facilities won't be enough to save East St. Louis.  And I think the closures make it pretty obvious what happened to J.B.'s missing marijuana tax revenue.  It went to Missouri.

Marijuana isn't the only thing cheaper in Missouri.  Everything is cheaper in Missouri.  And the parking lots reflect it.  Twice a month, we go to Crestwood, MO and buy groceries, liquor, cigarettes, clothing...everything but ice cream in the summer.  It's a pleasant day out, and there are always lots of Illinois plates outside the stores.  And we don't shop right on the border, either.  Crestwood is one of the ritzy Western St. Louis suburbs, about ten miles inside.  There are still a ton of Illinois plates everywhere.

Folks in Illinois haven't ever been shy about crossing state lines to get what they want.  If you drive eastbound on any Chicagoland freeway, you will be inundated with billboards for Krazy Kaplin's Indiana.  

Now that one of Illinois's neighbors has legal weed, too, the high sales tax avoidance habits of Illinoisans are pretty everyone but the high tax cheerleaders in Springfield, that is.  Sales tax tourism is a thing.  Just ask the Missouri Department of Revenue!

Image: Kai Gradert via Unsplash, Unsplash License.

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