6 Policy application . A legislator asks you to fi gure out how to eliminate the property tax and replace the lost revenue with a higher sales tax. Both the sales tax and the property tax each currently provide about 25 percent of total state and local revenue. She wants to know how high the rate would be. Marshal your arguments to persuade her that this is not such a good idea, using the concept of elasticity. Figure 11.10 and Equation 11.4 should be used in developing your answer.