Stockton's Tax Bump Won't Be Beacon For Bankrupt Cities

Law360, New York (November 7, 2013, 4:31 PM EST) -- Residents of Stockton, Calif., on Tuesday passed a tax hike that is intended to resolve the city’s debt crisis by taking the heat off of bondholders and retirees, but experts say raising taxes isn’t necessarily a realistic solution for other bankrupt municipalities.

The measure, which raises the city’s sales tax from 8.25 percent to 9 percent beginning April 1, 2014, will bring in an additional $28 million a year and will keep Stockton from being forced to cut $11 million in services a year, the city...
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