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Taxation by Citation? Exploring Local Governments’ Revenue Motive for Traffic Fines
Author(s) -
Su Min
Publication year - 2019
Publication title -
public administration review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.721
H-Index - 139
eISSN - 1540-6210
pISSN - 0033-3352
DOI - 10.1111/puar.13125
Subject(s) - revenue , tax revenue , business , per capita , public economics , economics , finance , population , demography , sociology
Abstract Anecdotal evidence suggests that local governments may have a revenue motive for traffic fines, beyond public safety concerns. Using California's county‐level data over a 12‐year period, this article shows that counties increased per capita traffic fines by 40 to 42 cents immediately after a 10 percentage point tax revenue loss in the previous year; however, these counties did not reduce traffic fines if they experienced a tax revenue increase in the previous year. This finding indicates that county governments probably view traffic fines as a revenue source to offset tax revenue loss, but not as a revenue stabilizer to manage revenue fluctuation. This article also finds that low‐income and Hispanic‐majority counties raised more traffic fines. Counties that generated more revenue from the hotel tax—a tax typically paid by travelers and visitors—raised more traffic fines, indicating a possible tax‐exporting behavior by shifting the traffic fine burden to nonlocal drivers .