From the Watertown Public Opinion, Speaker of the House Mark Mickelson was out on the road yesterday to promote his ballot measure increasing taxes on tobacco products to help fund tuition for Tech Schools:
Over a luncheon with Watertown school, business and community leaders, South Dakota House of Representatives Speaker Mark Mickelson, R-Sioux Falls, advocated for the tax increase that, if passed, would potentially raise $30 million annually, with $20 million going toward decreasing student tuition and fees at the state’s four technical institutes. The other $10 million would go into the state’s general fund.
and…
Although Mickelson acknowledged there is little correlation between tobacco and technical institutes, he had a simple explanation as to why the potential ballot measure is looking at raising only the tobacco tax: It’s easier.
Polling conducted by Mickelson’s associates showed about 65 percent support for the tax.
“We only picked tobacco because the public will support it. It’s that simple,” Mickelson said. “We already know the public supports tech students. But it’s a lot harder to get people to reach into their pocket with their support. We think this is a place they will reach into their pockets to support it.”
I think my concern is that it seems that as a funding mechanism, it’s unreliable, especially since the increase in taxes may make the funding source even more unstable than it already is. That was one of the problems with proposals to put video lottery down as a source of education funding. Because what do you do when people stop using it?
What are your thoughts on all this?
“A government which robs Peter to pay Paul can always depend on the support of Paul.” – George Bernard Shaw
I suspect a $1 increase in the tax would not only fail to raise the projected revenue, but would more likely reduce the revenue presently collected at the current rate.
It’s reasonable to assume that many smokers already purchase their tobacco in surrounding states with substantially lower tobacco taxes.
State cigarette tax rates as of April 1, 2017.
1.53 South Dakota
0.44 North Dakota
0.60 Wyoming
0.64 Nebraska
I think you over estimate the planning that goes into the typical tobacco purchase. It’s typically an inconsequential purchase, oftentimes an add-on when purchasing fuel or food / drink items at the gas station or grocery store. It’s not like people are consulting their financial planner on major tobacco purchases. Sure, if someone is already traveling to another state they may pick up some extra tobacco to avoid South Dakota state taxes, but I would doubt many people are specifically traveling out of the state to make these purchases unless they live within a few short miles of the state border.
As smoker, I respectfully disagree.
When a cartoon price is currently over $50, it’s no longer an “inconsequential purchase,” for most people.
Personally, I pay less in South Dakota tobacco taxes now, than I did before the last increase. I simply purchase in bulk when I’m out of state, which is frequent enough it’s not a problem.
I too know people that drive to the rez purposefully for gambling & to purchase cartons of smokes, they say it’s cheaper there. Also, if they travel to MN, they buy bulk before they leave. I would agree, not the majority of smokers do this, but if there was a tax increase it could easily change. The ppl of Philadelphia started to purchase soda outside the city bc of their ‘soda tax’, it does have an impact on people’s choices.
What do I think?
Glad he’s not running for Governor.
Want more money for your pet program — go deal with it through the appropriations process.
As with a lot of these measures they should have to at least TRY at the Legislature first….
When are the people in Pierre going to realize that we cannot continue to fund our State on the backs of citizens making bad choices: Gambling, alcohol, and tobacco? What’s next, fast food, condoms, and birthday cake? Maybe fine people if they do not attend a gym at least 3 times a week. Oh wait, RED MEAT! Look out, they will be coming for your T-Bone!
Please find a sustainable funding source that is moral and ethical!
Having been in the tobacco distribution business for more than 50 years, in both South Dakota and Nebraska, I can tell you the revenue projected for the state on this proposal is not doable or sustainable. If you don’t think people are going to cross the state border to save $20 or more on Cigarette Excise tax you are only fooling yourself. In addition the state and local sales taxes will be minimized as well. With a third of the states population living in close proximity to other states with much lower excise taxes rest assured that those dollars will cross the border to states neighboring South Dakota.
It is amazing to watch the tax and spend mentality at all levels of government, regardless of party affiliation, rather than to live within your means and prioritize a budget.
It is morally disgusting to stick it to smokers by taxing them so that the rest of us do not need to pay the taxes. If the revenue is necessary, and in this instance I do not think that it is, treat everyone equally and tax everyone equally. It is an elitist attitude to say, “tax the lowlife smokers”.
Mickelson’s ballot measures have revealed that he is no conservative!
Mark said they only picked tobacco because the public will support it.
That’s because about 75% of voters don’t smoke. They will be voting To tax other people. Considering that those other people tend to be at the bottom economically, taxing the poor so that middle class students can go to tech school is about as awful an idea imaginable.
But since Democrats are always in favor of keeping poor people poor, they will be enthusiastic and Mark can brag about bipartisan support.
Mark Mickelson needs to hang it up! What is going on in his mind? How does he come to these conclusions that what he is doing is justified? These crazy ballot measures and now this?!?!?!? Who is he representing ? Not a lowly independent, that’s for sure!
I wish more SD voters would approach the ballot box with more of an independent mind, and just vote some of these people out! Even if it means, heaven forbid, the other party. And if you don’t like them, vote them out the next round! Ain’t that fun!
I am sure that organized crime will love the chance to grow their smuggling business.