Task Force recommends that everyone have some skin in the game

From KELOland, the Governor’s Task Force on Education recommended that sales tax is likely the best tool to raise funds needed for teacher’s salaries:

The task force recommends keeping the education funding the same at three percent or the rate of inflation, whichever is less. But it does call for an additional $75 million in revenue to raise teacher pay to an average of nearly $50,000 a year.

Daugaard was able to raise that same amount to pay for roads during last legislative session.

“It’s a two-thirds vote and the margins for road funding was very thin so we’ll see if there’s a will on behalf of the legislature. And I also have to feel as if there’s true reform being accomplished,” Daugaard said.

The task force provided ways for schools to control expenses and be more efficient, while suggesting that a good source of revenue for raising salaries will be through a hike in the state sales tax.

Read that here.  And according to a report in the Argus Leader, retailers are not necessarily opposed:

Shawn Lyons, executive director of the South Dakota Retailers Association, said the group would be receptive to discussing a tax hike. The association represents about 4,000 retailers across the state.

“If we’re going to go down the path of looking at a sales tax increase, the conversation of property tax relief, especially for commercial retailers, is very important to us,” Lyons said.

Though he said retailers that sell more expensive products had reservations about accepting the increase. Lyons said many had expressed concerns about losing a competitive advantage to online merchants that might not be subject to the same taxes.

Read that here.

I’m not sure why they need to offset a tax they collect from others against one they pay themselves right now, but if I were lobbying on the tax, I’d try it too. And they are correct on the internet sales tax.

Quibbling over minutia aside, the most important thing is that if there is going to be a tax increase to fund education, it is important that everyone participate.

Not everyone pays property tax, but all South Dakota residents who consume or purchase goods pay sales tax. It’s what you might term “having some skin in the game.”  And in the case of sales tax, everyone does.

The flip side of it, is that if we add a penny or a half penny, this is still going to be a massive tax increase. And as Tony Venhuizen, the Governor’s Chief of staff quipped in referring to what plan the administration prefers, “my favorite is whatever one the legislators will pass.”  And he’s quite right.

In an election year, legislators are going to have to balance the demands of their constituents for improved salaries in education against people not wanting to pay more in taxes, and blaming legislators for any tax increase passed.   There will certainly be districts on either side of that divide.

It may come down to a district by district vote, with the conservative anti-taxers versus the districts demanding increased teacher salaries.

What do you think? What district are you in, and where do you want your legislators to line up?

25 thoughts on “Task Force recommends that everyone have some skin in the game”

  1. A conservative website headline would have read:

    TASK FORCE RECOMMENDS LARGEST TAX INCREASE IN SOUTH DAKOTA’S HISTORY.
    Byline: Liberals claim victory.

    1. That would be dishonest! The largest tax increases in SD history occurred this spring when they raised several taxes AND vehicle registration fees as they increased spending, and created more govt (debt collection agency).

      Lynn Disantos was right, our legislature and governor vote and legislate like Democrats!

      1. Well, you may be right over time, but the $200 plus million will be the single one-time largest tax increase in the history of South Dakota.

  2. I would support a corporate and personal income tax. That’s not gonna happen, though, so next best would be to increase property taxes. That’s not gonna happen though, so next best would be to increase sales tax. Add in the Medicare expansion, and exempt things like groceries and clothing. Still probably won’t happen, but that’s where the discussion needs to start IMO.

    1. Seems the train left the station. They’re already calling for more revenue.

      I don’t quite understand the offset suggestion. If they need “more” taxpayer money to give to teachers (and medicaid) they need a net increase. Sounds like fluff.

      1. Medicare expansion would increase sales tax revenue as it has in those states where it’s been adopted. I would leave current sales tax on groceries and clothing as-is, exempting only the proposed increase.

  3. the real question is will they just ask for the 75 million or will they (the Gov.’s office) ask for a whole cent and use the occasion to grow government.

    1. The could ask for a full penny and use the balance in the short term for bridges & roads, among other priorities. The looming state government cost, as always, is the state’s portion of Medicaid. Regardless whether SD expands Medicaid in some way – the Governor’s newest waiver proposal or otherwise – Medicaid reimbursements are ridiculously low and the state’s costs continue to increase based on population expansion and utilization increases.

    2. Our RINO governor and legislature had two of the largest tax increases in SD history this year, large increase in vehicle registration fees, increased budgeted spending, AND created more government under Democrat Peggy Gibson’s leadership (state debt collection agency).

      Surely you jest in pondering what our RINO legislature and governor will do.

  4. We already knew the Medicare expansion would usher in massive economic development if only someone would pass and sign it. NOW it’s wonderful to see it’s also a boon to increasing teacher pay. I look forward to the day that it also exponentially increases the miraculous cures wrought by the use of medicinal marijuana, and possibly also cures cancer in our lifetimes. Those of you who see the Medicare expansion as a lousy federal bait-and-switch, i.e. short term federal money meant to headfake states into massively increasing their in-state Medicare financial burdens, well you’re WRONG WRONG WRONG I tell you, WRONG.

  5. I think if they do it they should do a full penny and then lower property taxes for home owners by $100 million. Don’t let government grab that extra $100 million. And really can’t and shouldn’t cut property tax on businesses — the biggest recipients of lowering business rates wouldn’t be small retailers — many of whom don’t even own their own buildings. The biggest recipients would be places like Walmart, Menards, the malls, etc — all out-of-state companies — wouldn’t be smart to give them giant property tax breaks. On the ag side, the ag levy is already so low and frankly in most parts of the state, farmers pay a small fraction of homeowners and business owners. So use $100 million to cut homeowner property taxes — something that helps the cost of housing and helps the vast majority of South Dakotans, including farmers and business owners.

    If we do this right, everyone pays a little more to pay teachers fairly. And most South Dakotans get a property tax break — we don’t pick business or ag industry to get more of a break. All homeowners treated equally. Yes, renters would get the short end of the deal, but many renters will one day own as well.

    1. Folks,
      Medicare is a good thing. MediCAID is what Obama and Daugaard want to expand.

      A cool $100 million ongoing. That’s all we’re talking about, based on the presumption that the fed money won’t run out since it’s free and we’re in favor of taxing some to pay others.

      Is this South Dakota we’re talking about? Wt$!

      1. Unless your a farmer, retailer , or renter you really have no basis to speak for what they want.

        Really, who are you to judge?

  6. Jonboy,

    It’s pretty obvious you aren’t a retailer whose customers would pay more to buy their product, a farmer or a home renter but a homeowner.

    1. Troy, sounds to me like you’re almost arguing for an income tax. Can you believe the audacity of the retailers for being open to a sales tax increase and asking for a property tax break? Unbelievable.

      If they were smart, they would go for a state income tax, much like you are advocating in your post.

      1. I doubt that he knows what he is “arguing”. He has no idea what it takes to farm, run a business, or be in retail, or what customers are willing to do. A rather unchristian attitude.

      2. I remember the last week or two when we had guest columnists that led to mostly civil discussions, and the absence of a certain someone, but now…

        we back to the same old name-calling, misstating others’ comments, personal intrigues, and unchristian behaviors wrapped in bizarre egocentric mysticism.

        Farmers, retailers–they seem to be open to new ideas on funding IF it is clear how it will be spent, and that the spenders will be held accountable.

  7. Daugaard needs to get a handle on the tax increases. I’m not necessarily opposed to all of them but I would like to see the education system looked at being reformed and restructured as a whole before raising taxes

  8. South Dakota’s disposable & business spending drives our consumer economic model as well as the source for sales tax revenues. Will someone please explain how adding news taxes to the state creates new revenue for that economic model? How will the private sector replace the revenue which the state government will selectively re-distribute? Does this mean that O’s plan to re-distribute America’s wealth might not be a bad plan?

  9. Have you ever looked at an ag tax bill? Really low levies and really low land values. Ag community has been getting a sweet tax deal for decades. Before you scoff, go look at actual numbers from farms in your area. Then compare that to your house or business.

    1. Interesting.

      So, at some point, we’ve distinguished between ag land and residential land, and that balance has tipped too far in favor of ag land?

  10. How much did it cost the taxpayers of SD to run this Blue Ribbon Task Force? I’d really like to know. They found out nothing more than they knew beforehand – they wanted more money for teacher salaries and more taxes. So we in SD paid X amount of dollars so they could now go to the legislature and say what they already knew – that the education department wants more money and taxes need to be raised? But I guess that’s how govt operates nowadays.

    I think taxpayers would be willing to pay a little more in taxes (with EVERYONE having skin in the game) if we trusted how that money would be used — if we knew how much money was paid for administration (both lower and higher education), how much was paid for new buildings (both lower and higher education BTW), how much is paid for athletics (administration, athletic directors, coaches, referees, equipment, travel, meals, accommodations etc), how much was paid for worthless task forces, etc.

    And BTW, farmers and ranchers pay very high property taxes. I remember when our local district wanted an opt out to build a new gym, and the people in town couldn’t understand why we would object as the opt out would only cost them as much as a daily soda pop. Well, the ag owners would be subsidizing the additional cost needed to a tune of much more than a can of pop daily.

    Also, maybe if all agencies of the state govt were audited and the excess FTE’s and expenses cut, there would be additional money for education. And believe me, there is waste there. Maybe we need another Janklow to come in and do just that. People will never agree to higher taxes if they don’t trust that their taxes are being spent wisely, and they shouldn’t agree.

    And also, I just returned from a trip to North Carolina, and their teachers are complaining just the same about low wages. It’s just not here, and we are not the bottom if we factor in cost of living.

  11. I disagree with the contention that some people do not pay property taxes. We all pay for them. Renters and consumers simply pay them indirectly. The problem with a cut in property taxes is that we are unlikely to see the savings in our rents and prices.

  12. Skin in the game? Should everyone have this so-called “skin in the game”? One of my friends is a single mom who cannot make ends meet the way it is. She will be losing another one percent of her “skin” to this lame idea. I am a Republican but I am not a believer in increasing the tax burden on poor people.

    Sure, some of these folks get food stamps and other help but for what? So the State of South Dakota can tax it away? A one percent increase is a lot for those who haven’t got it.

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