Chew over these budget numbers:
- The Governor’s budget proposal projects sales and use tax revenue in Fiscal Year 2018 of $1.013 billion.
- That revenue projection is 0.64% higher than the $1.007 billion in the adopted FY2017 budget and 3.94% higher than the $975 million in the Governor’s revised 2017 projection.
- The Governor’s Tax Expenditures list estimates that sales and use tax exemptions will deny the general fund $1.092 billion in FY2018.
- That loss to exemptions is 12.5% greater than the $971 million assumed in FY2017 (when repealing just 13% of those exemptions would have paid for the Blue Ribbon teacher pay raises and Medicaid expansion).
Now tell me: how does our sales and use tax revenue projection rise only 3.94% while our projection of revenue lost to sales and use tax exemptions rises 12.5%?
To be simplistic, these are two separate figures not dependent upon each other. Or maybe, they project that the industries with exempt sales will have a stronger year?
Well Cory, you have developed amnesia. You see NOem projected 9.something percent increase overall. If you take 3% from 12% and carry over the percentage from infinity, you will find the magic numbers. In the NOem and Daugaard imagination o sphere, you can also see pixie dust while smelling unicorn flatulence while making exceptions. In short, something just does not smell right.
Maybe it’s all French Math.
Maybe it’s corruption.
Yes, horrible corruption that overstates the wild ass guess at untaxable amounts, to try and trick people like Mr. H and the libbies in the media to call for tax break repeal. That Governor Daugaard is a tricky fellow, working his data to steer the minds of some in South Dakota.
Good news, South Dakota. You can now get online retailers to collect SoDak sales tax. Online retailers have shown they’d rather collect the tax and pay it to the state then have to follow the law and pressure their customers to pay it themselves.
WASHINGTON — The U.S. Supreme Court on Monday let stand a Colorado law that pressures online retailers to collect sales tax — a decision that could motivate other states to pass their own “Amazon tax” measures.
http://www.denverpost.com/2016/12/12/supreme-court-colorado-internet-sales-tax-law/
To answer your question, well, you have identified how special interest, and its internal known growth potential, has successfully carved out exceptions to protect their interests… It is just an other example of the wealth class protecting themselves with the help of our “House of Lords” legislature….
But Mr. H, if they rolled back the sales tax numbers for this year what did they roll back the exemptions to? Would not the increase from the rolled back numbers be even greater than the staggering 12.5% increase you calculated out? My math is bad so I can’t calculate it but you could calculate backwards the one number based on how much the other number was calculated backwards and then calculate it forward and make your 12.5% number be probably bigger. I think it would be bigger. Bigger, I’m pretty sure.
Of course, without having to do any math, French or otherwise, I can think of a couple of situations that would make your 12.5% calculation wrong.
If only the Governor and his son-in-law wouldn’t have disappeared’ Mr. Dilges…we would know the truth.
Dilges dismissal is so Putin like.
Mr. Sol, I wondered about that, but 40% of the exemptions are for agricultural purchases, and the Governor has said the downturn in ag is a big part of why this year’s sales tax revenues are down. I haven’t heard the Governor or anyone else projecting a big ag surge outpacing other economic activity in the coming year.
There’s no complicated math here, Grudz. The exemptions in the FY2018 document are exactly 12.5% higher on every line than the same exemptions in the FY2017 projections from one year ago. I’m not looking at any rolled-back numbers on exemptions.
Cory, most of the ag exemptions are for crop and livestock inputs. These are generally things that farmers cannot cut back on much without harming yields and profitability.
The taxable items for machinery purchases are the first thing that farmers cut back on in a downturn, so it makes sense to me that there would be some disconnect between taxable and exempt farm purchases. It is the difference between needs and wants, generally speaking.
PS The other thing to consider is that a couple of years ago we ended the most profitable period in American agricultural history. Farmers made incredible investments in ag machinery and technology during this period of time. Thus, farmers are well equipped to go without purchasing as much machinery and equipment since they purchased so much in the prior period.
Cory, 24 million misappropriated funds is something I found that smells. There is no mention of this theft..er..borrowing. Will Trump look the other way? http://www.argusleader.com/story/news/2016/08/13/how-south-dakota-took-money-and-ran/88563764/
I think those given numbers you posted are missing a big ol chunk of looted funds. This would be more than enough to have funded Medicaid Expansion.
Regarding the DAPL and the work done in South Dakota, does anyone have a clue on how much excise tax the contractors paid and how much was paid into Workmen’s Compensation? I keep wondering about all those jobs that were being generated by this pipeline. Is that a state secret?
Do these numbers account for the increased sales tax rate?
So Darin, how does spending on those necessary inputs increase 12.5%?
I wonder if it is because the sales tax went up 12.5% to pay good teachers more money. Remember that law bill that they argued about to add one half of a penny? Check my French Math but isn’t $0.005 divided by $0.04 exactly 12.5%?
Wait—Francis, you may have answered my question. If last year’s exemptions are based on the old 4% rate and this year’s exemptions are based on the new 4.5% rate, than bang—there’s 12.5%. But, interestingly, the exemptions then appear to be assuming zero growth under every category, which doesn’t fit with the Governor’s assumptions of 2%+ GDP growth, 2%+ inflation, and 3.9% growth in sales tax revenue.