Argus Leader editorial scolds legislators for not raising taxes, and asks for new ones. Except on themselves.

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.

Read it all here.

“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 lineLast 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.

29 Replies to “Argus Leader editorial scolds legislators for not raising taxes, and asks for new ones. Except on themselves.”

    1. Anonymous

      End the requirement to publish minutes in the newspaper and save local governments hundreds of thousands of dollars–if not over a million dollars–every year! Let’s do it Argus!

  1. Springer

    Well, this just reinforces which political party runs the argus. Dems never met a tax they didnt like.

  2. Ann Onymity

    To me this has always been a fascinating issue, and I don’t think you can blame this one exclusively on the ARGUS. Many legislators, maybe even some governors, have proposed ending that exemption from sales tax for advertising. Every time, the SD Newspaper Association came in hard and heavy to lobby against it.

    Interestingly, that’s the same group that always lobbied against allowing local governments to publish proceedings and other documents online instead of having to pay the local newspaper to publish.

    I’m sure it’s the same reason why insurance companies have to publish those ridiculous year-end balance statements that take page after page of newspaper space.

    1. Anonymous

      I’m not a fan of the tax exemption, but remember they would just pass the tax on to the purchaser of the ad. I’m ESPECIALLY not a fan of that.

      1. Anonymous

        That is true about the advertising tax, but abolishing the requirement that local government entities advertise their minutes would save taxpayer money. That would be one of the efficiencies the Argus complained that we rely on too much.

        Maybe the requirement that the insurance companies have to advertise their annual reports had a good reason when enacted, but how many other companies or coops have to do that? Maybe it is time to rescind that law. Oops, sorry Argus, that would be another efficiency in the insurance company’s operation.

      2. a friend of education

        That’s a legitimate point. If you raise the cost of advertising, what happens? South Dakota businesses are forced to choose: advertise less, raise prices, or both. Most agree that cutting the ad budget weakens demand, so businesses will be hesitant to make huge cuts there – although I’m confident higher ad rates = fewer ad buys, especially short term. In response, media will be forced to lower ad rates – which means laid-off workers, salary cuts, failing papers, etc.

        In some cases, prices will increase. But everyone knows higher prices slide us down the demand curve. Businesses can’t just “pass along” big price hikes to consumers because buyers’ budgets are limited. If sellers jack up prices, customers will buy less or find replacement goods. If new taxes are imposed, prices will go up some and sellers will pay workers marginally less (or defer raises). None of this is good.

        The reality: tax increases almost always create a dead-weight loss, one that harms the greater community. Yes, we need some taxes. We need police. We need courts. We need safe roads, etc. But we should keep taxes as low as possible – so transactions remain efficient.

        Taxes on things like sports betting (allowing casinos to purchase a license and offer sports betting) = the least harmful species. No one needs to bet on sports so if you prefer to avoid that tax you can. I am one who believes SD could NET > than 1 million per year from legal sports betting. Mainly, we move gambling transactions from the black market into the legitimate market.

        People make sports wagers now. Many are placed in Iowa and many are placed offshore. Most bettors lose — that’s why gambling is profitable. When bettors lose, we want that money to re-circulate in the SD economy, not drain off to crooks based in Aruba or Turks & Caicos.

        If, however, the Argus thinks we should RAISE taxes, we should either ignore that advice or start by taxing the Argus. Charity begins at home.

  3. tax committee legislator

    Ironically, I was just thinking that we should stimulate our economy by cutting taxes. Now I am motivated to introduce something!

  4. Anonymous

    Also a huge savings to government would be to allow the for counties, states, etc. to put legal notices on the web and stop subsidizing news papers who have declining readership!!

    1. Ann Onymity

      Kind of what I said at 4:41. Governor Daugaard tried to get the Legislature to allow publication of board and commission minutes online on a state website, but the SDNA wouldn’t have it so they lobbied hard. BTW, most of the association’s directors are from small papers:

  5. no more taxes

    Oh my…more taxes and more vices…what BS, clearly a liberal board…I agree why des any Republican subscribe to this trash?

  6. Troy

    Read closely the introduction: “ 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“

    “Folly” infers we are all a bunch of dolts.

    “Cutting waste and chasing efficiencies” in their minds isn’t to be done for its own sake because it is wasteful or return the taxes to those who earned it but to be spent someplace else.

    “improve the lives of our families, friends and neighbors across the state” makes it clear they think lives would be better if we took more money from people working and the government spent it.

    “ It’s incumbent upon lawmakers to explore opportunities to change the dynamic” because going back to their arrogance we are a bunch of dolts, what we have been needs to be different.

    “explore modes of increased revenue” because it is a given we just need to spend more. Note they have given a lot of thought to how they can tax others than themselves but not made a single case about how a single dime would really improve the collective good of our state or even select pockets who they deem are being ignored.

    It is clear the first waste we need to eliminate is the requirements for printing of minutes And other notices in the paper. There are more people who have access to the internet than subscribe to the Argus (even in the heyday of the Argus). Anticipating their comeback “what about the people who don’t have access to the internet?”, I have two responses:

    1). Back in the day, did you care about those who didn’t subscribe to your paper and, if so, what did you do about it?”. We all know, they care about the money, money they are quick to take from others in taxes at the point of a gun to fund their whims.

    2). We have the technology to identify every residence without internet access. I propose we regularly send them snail mail telling them of all the public notices on file at the Courthouse with a return envelope which they can check a box of any notices they want sent to them. I will bet the taxpayers will save significant dollars.

    Frankly, I expect more intellectual depth in a high school paper’s editorial.

  7. Anonymous

    I hope the legislature seriously considers Pat’s suggestion. Let’s repeal the tax exemption. It’s not like newspaper circulation could get any lower….

  8. Michael Held

    1. Reminds me of former Senator Frederick’s saying:
    “Don’t tax you and don’t tax me,
    Tax the man behind the tree.”
    2. They forgot to list as a “shining example” how well budgets and fiscal policies are working in the top ten “highest tax” states in the union. Argus, give us one shining example on that list.

  9. Anonymous

    The legislators should eliminate all of the sales tax exemptions and dramatically reduce the rates on everything. That would be true equal treatment before the law!

  10. Anon.

    I find it interesting that tax expansion doesn’t work, tax shifting doesn’t work, tax increases don’t work, tax reductions don’t work, and tax exemptions don’t work. Why? Because nobody wants to live within their means. I have watched every change in tax law do nothing but create further needs by all levels of government. I.E. property tax reduction of owner occupied and ag land in the mid 90’s and the new ag land assessment changes in the early 2000’s. This was all done with a huge shift and broadening of taxes and fees. What relief there may have been was of little notice because the legislature in their infinite wisdom gave all local governing authorities the OPT OUT privilege, that most have taken advantage of to increase revenue, cities, counties, school, townships, ect. . Even with economic development tools to increase the tax base, revenue is still not sufficient for any form of government and/or it’s subsidiaries. When will government officials finally get serious and begin to live within their means? To many pseudo-millionaires out there patting each other on the back saying,” I want this, I want that, we can afford another tax increase or two, our last tax increase was a whole year ago.” When one, two, or three local units of government opt out it becomes a huge burden on the tax payer. Government spending at all levels needs to be reined in or there is going to be a major catastrophe sooner or later. Many taxpayers are reaching the end of their rope, what will they be able to give up in the future, their home, healthcare, food, utilities, and when all dignity is gone, nothing is left, is it their life that is sacrificed for the wants of overpaid executive officials in all levels of government?

  11. Ann Onymity

    It’s incredibly difficult for anyone to “live within their means” when the revenue is “still not sufficient” to meet their needs. I don’t know about your town, but the streets in mine are horrible. Yet, we can’t go after more revenue because the Legislature continues that stupid property tax freeze Bill Janklow got passed when he had to counter what Jim Beddow was proposing to cut property taxes.

    We’re a bargain when it comes to taxes and fees. Property taxes have been low forever, we have no income tax, and vehicle licensing here is cheap. The boom in trust companies and all those bogus residents who pay for a mail forwarding service here so they can get cheap vehicle licenses attest to that.

    We just put too much emphasis on the regressive sales tax, and if, God forbid, a city or school district is ambitious enough to want to fix their streets or pay their teachers well, the Legislature’s got that covered by forcing them to do an opt out.

  12. Anon.

    Ann Onymity: I don’t disagree with what you have said, but the fact remains that the state, county, and local governments seem to be unable to give enough taxpayer money in the name of economic development, that supposedly increases the tax base, and is suppose to effectively solve governments need for additional cash from the already overtaxed to finance greedy millionaire’s.
    That said if economic giveaways worked they would have the additional money for capital outlay and general fund budgets.
    Apparently that philosophy is not working. If it wdere we would not have a problem finding money for local roads, and increased salary’s for educators.
    It is amazing what some elected officials will spend for a huge net loss in the name of economic development.
    It does not work, never has worked, and never will work, but try telling the ultra wealthy, the wanna-be’s, and elected official that, and yes even school officials. If you tell them that you will be chastised, and called anti-development while at the same time not being able to show evidentiary proof that it works.

  13. Nancy Vogel

    I have a friend who works for a large Sioux Falls law firm and she says people come from all over the US and the world to set up trusts in SD. It does seem like that the legislature could look at this item.

    1. Anonymous

      They come because of our favorable tax climate. Raising taxes would drive that business out of our state.

  14. Anonymous

    We complain about politicians like Bernie Sanders, Elizabeth Warren, and AOC because they promote socialism as the answer to our problems. But remember socialism is simply more government being involved in more aspects of our lives. Raising taxes and increasing the size of government does just that. Frankly, we hear this, not just from the Argus Leader, but also from a number of state Republican politicians.

  15. Anon.

    Some day when the editor and/or the papers staff, make the majority of their lives, working and then retiring in SD, you then will become relevant. Until that time, keep your mouths shut and try to report on Sioux Falls issues. Let the adults in South Dakota talk. Argus, when you sold out and down sized staffed you quit mattering. Sad to say, the AL is a funny punchline.

  16. Anonymous

    So the morons on the editorial board of the Argus Liar want us to become like states that are losing population? Great idea!

    Also, when you describe the deed tax on property taxes of $1/$1,000 as “miniscule”, did you check out the fact the Minnesota charges 33 cents/$1,000?

    The things that the nitwits at the paper want to implement will take away the advantages that make South Dakota a great place for business.

    We stopped even buying the Sunday edition of this rag years ago.

    1. Anonymous

      My calculation error on Minnesota’s deed tax, so I humbly retract that portion of my post; however, the rest stands.

      Minnesota is $3.30/$1,000. However, I still don’t believe in keeping up with the Joneses, especially when the Joneses have Omar as one of their reps.