The Argus Leader has an editorial today where they’re scolding legislators for not raising taxes, and goes so far as to advocate for several new ones that could be imposed:
It’s folly to rely exclusively on cutting waste and chasing efficiencies to improve the lives of our families, friends and neighbors across the state. It’s incumbent upon lawmakers to explore opportunities to change the dynamic and explore modes of increased revenue, as other states have done:
- Sports gambling. More than a dozen states have legalized sports betting and are reaping the benefits. Iowa brought in $1.1 million in sales tax in its first four months of legal sports gambling. Tweaking how that sales tax is structured could optimize the state share of the impressive revenues seen so far.
- Mansion taxes. South Dakota’s relatively miniscule real estate transfer tax of $0.50 per $500 of value – one-tenth of one percent – could be revised to a bracketed system, with slight increases in rates at higher value breakpoints. Several states have implemented or increased this tax, but Washington state in particular may provide a good template to follow.
- Getting creative with trust laws. Creative lawmaking has turned South Dakota (dubbed “the new Switzerland”) into the top tax-haven destination for the ultra-rich to put their trust funds. The state only collected $1.1 million in fees from the $175 billion in trusts parked here in 2015. Legislators can find a way to net more than .0006 percent of what is estimated will be $355.2 billion in trusts by the end of 2020 without sacrificing our ranking as a safe harbor.
- Corporate income tax. Taking a look at the huge tax breaks we award businesses that are located here could allow more South Dakotans to reap the benefits a corporate-friendly climate.
- And, yes, a modest personal income tax. South Dakota is one of only seven states that doesn’t have a state income tax, along with top trust-haven pals Alaska, Nevada and Wyoming. The “tax we do not speak of” could use further study to determine future viability.
“Sin taxes,” in the form of new gambling. Increased real estate taxes. Increasing taxes on trusts. Corporate and personal income taxes. That’s quite the list of people they think should be taxed.
But…… I can’t help but notice in that all these new taxes they’re advocating, they’re leaving a very easy one out – one that would not require any additional staff or new bureaucracy to collect it. Just the removal of an exemption.
So, why don’t we see the Argus Leader actually leading and setting an example – and campaigning to removing the sales tax exemption on advertising to help boost the state’s bottom line? Last it was looked at, it was estimated that a sales tax on advertising would bring in $21 Million* to state coffers. Not exactly small change. (Update, I just spoke to an appropriator who pointed out it’s up to $35 Million!)
Just like anyone else, as far as the Argus is concerned, the best taxes are those that others pay. So, they can climb off of their high horse anytime, demanding that government tax more so they can spend more.
Because they don’t want to pay any more in taxes than the rest of us do.