Issue Position: Taxes

Issue Position

No one likes paying taxes, but they are necessary to provide public infrastructure such as roads, bridges, schools, public buildings and government. South Dakotans have very low taxes compared to some of our neighboring states. Some people will say that this is a boon for economic development, but it comes at a price. Our tax structure is labeled as one of the most regressive in the US. This means that the lowest-income South Dakota residents are paying a higher percentage of their earnings in total taxes than the higher wage earners. In fairness to the lower wage earners, I would support a repeal of sales taxes on food. To adequately support education and Medicaid, our two largest budget items, I think our entire tax structure should be evaluated by a non-partisan committee.

In South Dakota, the annual budget report is drafted and submitted to the joint appropriations committee of the legislature. It is passed by a simple majority. Some states have a budget committee that meets regularly during the year to evaluate revenues and debits of the state. These committees are non-partisan and are in a better position to advise the legislature and state officials on the annual budget.

Cash giveaways of state funds to large corporations such as Trans-Canada for the pipeline have also hurt our budget without generating as much in property taxes as promised. I think the pipelines are fine, but they could have been built without the cash giveaways as proven by neighboring states.

Some politicians like to blame the Federal Government for causing our budget woes through mandates. In truth, our state would be in pretty sad shape without the federal funds. In 2005, the Tax Foundation calculated that South Dakota received $1.58 from the Federal Government for every $1.00 paid in federal taxes. In 2012, nearly half of our state budget--$2 billion--came from the Federal Government.

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