Whom Would You Tax?

I have yet to hear a convincing case that South Dakota's state budget woes can be blamed entirely on wasteful spending. I don't think a single legislator has offered a plan that corrects either the immediate shortfall or the structural deficit entirely through budget cuts. Even Governor Rounds himself, who has often vowed not to raise our taxes, has coupled his proposed budget cuts with plenty of revenue enhancements.

So, for the sake of this argument, assume we have to find more tax revenue. Whom should we tax? Let's compare approaches. Our man Gerry Lange would increase taxes on the following:

1. Video lottery establishments, who activity imposes external social costs (HB 1191†);
2. Folks with the money to buy and maintain motor homes (HB 1193);
3. Investors making more than $1,200 on interest and stock dividends, with further exemptions for retirees and the disabled (HB 1195†);
4. Corporations (HJR 1001†) .

And lest you think Rep. Lange is just a tax-hungry liberal, note that Lange would also decrease taxes on farms and households auctioning off their property (HB 1131†), contractors (HB 1194†), and folks who buy food (SB 199).

Meanwhile, Republicans like Rep. Gordon Howie (R-30/Rapid City) would raise the sales tax 50%, which imposes a greater burden on lower income folks, in order to lower property taxes (SB 196). This switch would provide an inordinate benefit to rich property owners... like Gordon Howie himself. Go figure.

So whom would you tax?

†Deferred or otherwise defeated in committee—alas, our man Gerry has a tough time finding fellow travelers out under the dome. But keep up the good fight, Gerry!