Sunshine Taxes - The Cost Of Paradise

What is a ‘Sunshine Tax’?

‘Sunshine tax’ is an ironic term that's used in the United States of America and Canada. It describes the situation whereby salaries are most of the time lower than the cost of living and national average, in places that have a desirably temperate and favorable climate.

 

These areas tend to have denser populations, along with larger aggregate populations due to because of its good weather. The sunshine tax itself isn't literally a tax, rather it is the raised cost of living in a particular area due to favorable weather, which makes it seem like an involuntary ta is paid.

 

Other Uses

The term "sunshine tax" can also be used to explain anything that has the effect of making costs of goods and services higher in areas like the Sunbelt.

For instance in 2007, the San Diego Union-Tribune calculated the rate of the California sunshine tax at $1.1 billion, this is just for the additional cost of gasoline in the state.

In Hawaii a similar situation occurs, however is referred to the "paradise tax". This is because incomes there are lower and then the cost of living is higher in Hawaii than on the other areas around or on the mainland. It is also commonly referred to as "the price to be paid for paradise" or "the cost of living in paradise”.

 

Causation

Randall W. Roth, in his book titled "The Price of Paradise", listed a number of things that could possibly cause it. This included shipping costs, differences in regulation and land availability.