Many states impose absolute limits on municipal taxes, such as a one percent maximum property tax. States also commonly require electoral approval of municipal taxes. California's Proposition 13 is the best-known example of such state-imposed requirements. Such restrictions reduce municipal flexibility in dealing with financial distress and may contribute to municipal financial distress.
John Patrick Hunt,
Constitutionalized Consent: Preemption of State Tax Limits in Municipal Bankruptcy,
Yale J. on Reg.
Available at: https://digitalcommons.law.yale.edu/yjreg/vol34/iss2/1