AFP Files initiated measure to reduce sales tax

AFP-SD Files Initiated Measure Proposal Tackling the Sales Tax

SIOUX FALLS, SD—Americans for Prosperity-South Dakota (AFP-SD) today filed an initiated measure proposal to reduce the sales tax rate in conjunction with the Wayfair Supreme Court case decision. This effort comes in response to legislation passed in the 2016 legislative session that called for the reduction of the sales tax by 0.1% for every $20 million raised from online sales tax collection.

AFP-SD hopes that the South Dakota Legislature will tackle this important issue to avoid the cost of having this initiated measure effort appear on the 2020 ballot.

AFP-SD State Director Don Haggar issued the following statement:

“Now that South Dakota is collecting taxes from online sales, the legislature needs to fulfill the deal agreed to in 2016 and reduce the sales tax rate. Our activists are committed to ensuring that the legislature reduces the sales tax, but if lawmakers don’t, they will be equally committed to hitting the pavement to pass the initiated measure.”

Background:

AFP-SD is mobilizing activists statewide and urging lawmakers to keep their promise and lower the state sales tax.

To view AFP-SD’s website urging South Dakotans to contact their legislators, view here.

Americans for Prosperity (AFP) exists to recruit, educate, and mobilize citizens in support of the policies and goals of a free society at the local, state, and federal level, helping every American live their dream – especially the least fortunate. AFP has more than 3.2 million activists across the nation, a local infrastructure that includes 36 state chapters, and has received financial support from more than 100,000 Americans in all 50 states. For more information, visit www.AmericansForProsperity.org

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21 Replies to “AFP Files initiated measure to reduce sales tax”

  1. Anon

    Good for them. The idea that some legislators now want to spend the money instead of lower the rate, like they sad they would, is ridiculous.

    Reply
  2. Anonymous

    It’s not a ridiculous idea if you never believed they’d follow through with it anyway.

    SD GOP, out there raising taxes and breaking promises.

    Reply
  3. Anonymous

    I would not count on money from online sales tax to be a permanent source of state revenue. I project that Congress will make a serious push within 10 years to replace any online state taxes with a federal online transaction tax, claiming that all of this interstate commerce needs to be taxed to help fund roads, internet access and the postal service that make online commerce possible.

    Reply
      1. grudznick

        Nope. Online sales will balloon shutting down every JC Penny store in the world, and Starbucks going to a drone delivery method ends all brick and rock commerce. UPS and the USPS become the two most powerful organizations in the world, which has descended into a world like the world of Mad Maxamillion with tribes fighting with sharp sticks. The winner will be the government agency which will control the entire world.

        I, for one, welcome our new USPS overlords.

        Reply
  4. Anonymous

    Reduction of sales tax will lead to budget shortfalls. Budget shortfalls will lead to a state income tax. At some point near the end of her second term, Noem will sign a bill instituting a state income tax.

    Reply
    1. Platonic

      That would be some solid evidence of manmade climate change since it will be a cold day in hell when a SD gov institutes a state income tax

      Reply
        1. a friend of education

          I’ll take that wager.

          Let’s assume, for the purposes of argument, we lower the sales tax rate .1 percent

          Good news! Each South Dakota family keeps a little more of the money it earned. We want that outcome.

          We’ll spend most of that savings here, buying more stuff at Menards, Hy-Vee, Scheels, Campbell’s. You name it.

          Local business feel a boost. This creates investment & jobs. The economy grows. Wages inch up ever so slightly.

          Local taxing authorities thus recapture a fair portion of the money… but not all of it. Likely there would be a shortfall.

          But our legislators won’t cut the sales tax rate unless they expect, in good faith, to pull millions from online sales tax revenue. That’s money ADDED to the equation, an addition that replaces most of the loss.

          After we cut sales tax, out of staters (tourists, folks from neighboring states, drivers passing through) will buy more here as well. No, you wouldn’t expect a dramatic shift, but whenever we lower prices we spur consumption. Local businesses benefit.

          In exchange for these benefits, we’ll need to balance the budget.

          Would we resort to a state income tax? I *seriously* doubt it. I believe legislators will find it easier to close, for example, a 10-11 million dollar revenue gap via smart budget cuts. It seems VERY unlikely they’d go nuclear & resort to an income tax – something SD voters have categorically and unambiguously rejected. Plus, there are other ways to boost revenue. Allowing sports wagering in casinos, to cite just one example debated on this website, might increase state revenue $2 million per annum. If you don’t like that idea, there are others.

          I agree future online sales tax revenue is difficult to forecast. And, as someone noted, we could lose online sales tax revenue down the road. But if and when that problem arises, we can reset our sales tax back to 2018 levels. In the meantime, SD benefits.

          In 2016, the average South Dakotan shelled out more than $2000 to the state. We’ll help working families, we’ll become more competitive, and we’ll attract more skilled workers if we trim the fat & nudge the number down toward 1950. For comparison, Texas, whose citizens paid (on average) $1871, led the nation in economic growth, whilst California ($3955 per taxpayer) faces bankruptcy.

          Reply
    2. Anonymous

      So, are you advocating that we remove the automatic tax cut language currently on the books that reduces the sales tax rate from 4.5% to 4.0%?

      Reply
      1. a friend of education

        How much online sales tax revenue do you expect our state to collect next year? $10 million? $20 million? $99 million?

        I’d guess under $40 per SD resident, but I’m no expert. How much stuff do folks buy online? What’s the monthly average? I cede the floor to those with greater knowledge. Maybe I’ll attend the AFP event and see what data is offered.

        Reply
  5. Anonymous

    Don’t be fooled. AFP exists solely for the purpose of serving the Koch brothers, who attempt to impose their agenda upon us because they believe we are not capable of recognizing good governance on our own. Pure and simple, just another source of out of state money, trying to control S.D. politics and citizens.

    Reply
    1. Steve Sibson

      So how is South Dakota’s reduction in sales tax going to benefit the Koch brothers? Are they planning a major vacation to this state? Heidelberger is making the same illogical argument, whose purpose is simply to promote hatred within his group of Kool-Aid drinkers against those he disagree with.

      Reply
  6. Lincoln County Delegate

    I get the what AFP is trying to do but I question the strategy and timing of announcing an IM before the legislature can even pass legislation to lower the sales tax in accordance with the Partridge Amendment.

    I believe the intended effect is to hold the Legislatures feet to the fire on the issue but in reality I think it does the exact opposite. Why would a legislator who doesn’t want to lower the sales tax feel any pressure to do so knowing that in the next election he or she could just let their constituents decide and be able to avoid a potentially controversial vote? Speaker Mickelson tried this with his tobacco tax increase and it didn’t even make it out of committee.

    What would have been more effective for both passing it in the legislature and (if it came to it) on the ballot would have been to hold off on this announcement until after Session, pressured the Legislature to keep their commitment to the voters by passing a sales tax cut, and if it failed in the Legislature use that as a rallying cry to build support for the IM.

    Instead, Legislators that really don’t want to cut the sale tax now have an out to say “Well I’ll just let my constituents decide.”

    Reply
    1. Troy Jones

      For the record, the only reason I supported the online tax is because it was my expectation there would be a sales tax reduction (no revenue increase to the state between the two). My thoughts exactly.

      1) People always meet expectation. Thus, this makes it seem as we have an expectation they won’t do this. I think we should begin with the expectation they will do this. We have plenty of time to do the IM.

      2) People will take an out if you give it to them. Your comment is right on. I prefer to hold them to the fire for what is already on the books.

      3) I’d like someone to explain to me we even need a law change. In short, what is deficient in the Partridge Amendment and can’t it be just done via Administrative Rule by the Department of Revenue. It wouldn’t be the first tax law which is implemented via rule as it is more effiecient this way.

      Reply
    2. Anon

      If legislators decide not to do the right thing and vote against a tax cut, there will be plenty of time to make sure their constituents hear about it. Who wants to be the one voting against tax cuts?

      Reply

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