If the Supreme Court decides to overturn Quill v. North Dakota and allow South Dakota to collect sales tax from out-of-state Internet vendors, maybe other states will be able to collect license plate fees from South Dakota.
South Dakota wants the Supreme Court to approve SDCL Chapter 10-64 (originally 2016 SB 106), the Internet sales tax law that requires businesses outside of South Dakota that make either 200 sales or $100,000 worth of sales to buyers in South Dakota to act as sales tax collection agents for South Dakota.
Think about how strange that assertion of one state’s authority in another state is. Imagine you are sitting here in South Dakota and you get a letter from the Alaska Department of Revenue saying, “Hey! You work for us today! Fill out the enclosed forms and send us a check.” You aren’t from Alaska, you’ve never been been to Alaska, but you have a website that a lot of Alaskans read, and some of them send you money. It sounds crazy, but that’s the kind of interstate authority South Dakota is seeking.
So imagine other states turned that logic around on South Dakota on the issue of vehicle registration. There are currently over 58,000 motor vehicles parked most if not all of the time in other states. That’s an average of 1,184 cars per other state, far more than the 200 transactions South Dakota’s Internet sales tax law sets as its threshold for dragooning out-of-state businesses. Residents of other states are purchasing thousands of items from the State of South Dakota to avoid paying their home states’ higher license plate fees, thus denying their home state governments millions of dollars of road tax, just as Internet purchases deny South Dakota millions of dollars of sales tax.
Other states could make the case that South Dakota is an out-of-state vendor obliged under an overturning of Quill to collect taxes for the states where its customers reside. Even if the Supreme Court rejects our SD v. Wayfair challenge, other states could argue under Quill and its precedents that a registered vehicle establishes a “substantial nexus” in a state, using its roads and posing public safety risks. Other states should thus be able to order South Dakota to remit vehicle registration fees for vehicles registered in South Dakota but resident in other states.
So how do you think the State of South Dakota or the county treasurers issuing South Dakota plates will feel about getting payment-due notices and audit requests from the California Department of Motor Vehicles?
That licence plate thingy is something that no one wants to discuss..hee hee, that is why it amuses me when this grift is brought to our attention once more. For a law abiding state republican government, we sure go to great lengths to go rogue to cheat other states out of tax revenue.
What about emissions testing? Just wait until some super-smart scientist can assign a value to the amount of carbon SD tourists (yes, we do travel) dump in their respective states without repurcussion? Just wait until those states say “Hey! Your Escalade or Cabriolet has ruined our sunsets! Time to pay!”
This whole thing is just dumb. Forget making up budget shortfalls with gimmicks, legislature (and Marty). You’re not Wild Bill with his (somewhat) “visionary” revenue policies. It’s time.
#incometax
republican elected official Pennington County Treasurer Janet
Sayler said she does not know why Pennington County is so much more popular, but she knows state and county officials appreciate the extra revenue and are not likely to jeopardize it with a law change.
She expects to see South Dakota plates continuing to pop up everywhere.
“You can go on vacation in any state and see a set of South Dakota plates,” Sayler said, “and they’re people who’ve never even been here and have never driven on our roads.”
gee, janet, great SD republican/America’s mailbox-box elder business plan. straight from the horse’s mouth. thx to seth tupper’s jounalsim. apologies for offending old sarge.
Any fool thinking this may “save main street” is delusional. I’m beginning purchasing groceries on line because the local stores are challenged with reliable, consistent stocking. Judas priest, they take my information with every purchase, yet fail consistently stocking a few items I consistently purchase. Screw main street.
Will MN come after South Dakota folks who jump across the border to buy food because of no tax or other states that don’t tax food and clothing because it’s a “necessity” for their citizens but maybe not us?
T,
Why would MN try to tax clothing on another State when they don’t tax clothing?
You need to think deeply about your post.
Cory,
Just think about how many labor costs could be saved by getting rid of income tax and just have a “sales tax” for Fed and State. We had that and It worked for over a century.
Every time I have asked a Democrat to have that discussion they have declined. Are you able to do that with me?
Jason, just think about the labor costs saved by “Having” a state income tax as well as a sales tax for Fed and State. The states that presently have that are what I would call “Successful” with very good infrastructure to include teacher salaries, modern healthcare and stuff like that.
Every time I have asked a Republican to have that discussion they run for the hills and scream liberal liberal liberal.
Jason-all taxes are paid with income. But what you and others like you refuse considering is that the lower income spectrum pay so much MORE % of their income to the government! Fairness demands it–but GREED isn’t fair.
Jason,
Many other countries have attempted to implement a retail sales tax, or variants, and almost all have abandoned the tax and moved to a value-added tax. Governments have gone on record as noting that at rates of more than 12 percent, sales taxes are too easy to evade.
For reasons of equity, efficiency, and simplicity, establishing a broad tax base is a key element of sales tax proposals. The broader the base, the lower the rate can be. As the income tax shows, allowing specific exemptions creates a political slippery slope. Loopholes accorded to one group breed additional loopholes, by fueling demand from other groups for equally favored treatment and by weakening congressional resolve to stem the tide of special requests.
But taxing a broad base will be hard. Some items are quite difficult to tax, like imputed financial services. Other items may not be taxed for reasons of social policy. Child credits, rental payments, and some or all food may fall into this category. Finally, some sectors might not be taxed because of strong political influences—housing and health, for instance, though exemptions here may also be related to social policy.
While state sales taxes are widely viewed as successful, they are very poor models for federal reform.
States only tax about half of private consumption of goods and services. Many states exempt goods such as food, electricity, telephone service, prescription medicine and so on. Most states do not tax services very well, if at all. In addition, between 20 and 40 percent of state sales tax revenue stems from business purchases, which are not retail sales. This causes cascading of the sales tax, which distorts relative prices in capricious ways and gives firms incentives to merge with other firms in order to avoid the tax. States often do not require their own government to pay sales taxes. And states do not provide demogrants; instead they help the poor by exempting specific items like food.
What?s the Rate?
Determining the appropriate tax rate in a national sales tax can be tricky. For example, if (a) there is zero tax evasion, (b) state and local taxes do not change, (c) the tax base is not reduced by political or other factors, (d) nominal government spending is held constant, and (e) transition issues and economic growth are ignored, one proposal would require a 23 percent tax on a tax-inclusive basis, or a 30 percent tax rate in the more familiar tax-exclusive approach. (All of the following rates are tax-exclusive.) But realistic adjustments for each of the stringent conditions listed above raises the estimated tax rate.
The tax evasion rate under the income tax is between 15 and 20 percent. Evasion issues are discussed in the next section; here we simply note that a 15 percent evasion rate in the sales tax, which is probably conservative, would raise the rate to 35 percent.
In the absence of federal income taxes, states would likely have to convert their own income taxes to sales taxes and conform closely to the federal tax base. Add in the revenues from existing state sales taxes, and the combined federal and state sales tax rate would climb to 45 percent.
Suppose the tax base were reduced by one-third from the pure consumption tax proposed. In light of all the preferences in the current income tax, and the exemptions in state sales taxes, this is probably not an unreasonable assumption. It would come about, for example, if just food and health were exempted, or if just government expenditures were exempted. Cutting the base like this would raise the required rate to 67 percent.
Any transition relief provided to households would reduce the tax base and raise the required rate further.
Jake,
Lower income people do pay a higher percentage of taxes. It’s basic math.
They can fix that buy getting a higher paying job.
Do you think everyone should make the same amount of income Jake?
Jerry,
Washington, Texas, Florida, and Nevada are a few States that don’t have income tax. Are you saying they are not successful?
Debbie,
The US was fine without an income tax for over 100 years.
It is less costly to administer a National sales tax than it is the current income tax.
Jason,
You are Cherry picking- You forget they make it up in property taxes, gas taxes, etc. Some have natural resource taxes
Florida, South Dakota, Washington and New Hampshire all have higher than the median cost of living, Therefore more people living in poorer living standards
Show me your economic charts showing that there is less poverty in states with no income tax and then you will have a case
Debbie,
What does poverty have to do with income taxes?
What does cost of living have to do with income taxes?
Jason,
Lol
100 years ago the only thing the Government had to figure how to pay for was the Civil war.
The U.S. deficit for 2019 alone is $985 billion, not to mention the $21,079,825,622,461 we already owe – No sales tax could possibly cover it.
Debbie,
Thanks for admitting that the US Government has gotten to big. It was only 11 Trillion 8 years ago.
Btw Debbie,
You never answered my questions?
Jason,
Simple economics 101 – The cost of living is the minimum expenditure necessary to achieve satisfaction-
Sales taxes as well as other unavoidable taxes increase what it costs to live since you cannot avoid them= higher cost of living.
You can get a break on income taxes , you cannot get a break on taxes ,hence you have a higher level of poor.
You can look at any economic overlay and see that the states with no income tax have a higher level of poverty than states that have a income tax.
I can live much better and cheaper in Montana than SD because the sales taxes , property taxes, convenience taxes,city taxes, and service taxes in SD add up to much more than the property tax, and car registration , and income tax in Montana.
Jason,
Don’t make up stuff people did not say.
You seem to be such an expert on economic theory , so tell me again why we quit feudalism as an economic system ?
That was very limited government.
Debbie,
Poverty and cost of living have nothing to do with taxes.
That’s a fact.
Thanks Debbie for pointing that out about median income. In South Dakota, if you want something that main street does not have, the only solution is the internet. Even if this is passed, business in South Dakota will close like Sears has done, like Herberger’s has done as two recent examples. Why go any farther than you mail box for the goods you seek?
Debbie,
Let’s talk about Venezuela. That’s the current evidence against Democrat socialism policies.
I have noticed that Jason’s fix it it is always “get a better job”. Of course this amuses me when the people he speaks of already have more than one job just to make ends meet barely.
Jerry,
Those stores didn’t close because of taxes. They closed because people would rather shop over the internet than drive to a store.
Why spend gas money when you can order something over the internet and have it delivered to you?
Jerry,
Are you for socialism?
Do you think everyone should be payed the same?
Jason,
Actually aren’t closing because of the internet either.
Except for mom and pop businesses, all the stores having bankruptcies also had huge internet presence.
Yes internet sales numbers are up but they in no way are picking up the entire sales drop from brick and mortar.
So explain that one Jason
Jason,
Given your knowledge or lack of knowledge of Capitalism how in heck could you possibly know the first thing about socialism- If you are going to talk about unearned money , Let’s talk about the unearned money that is given to billion dollar corporations every day from my labor. I earn it and they get it.
Cheaper prices at other stores.
Bad products.
Bad customer service.
Dirty stores.
That’s just a few Debbie.
Debbie,
What don’t I understand about Capitalism?
Let’s talk about the earned income credit.
Debbie,
Let’s talk about the cost of living regarding Williston, ND during the latest oil boom. Are you knowledgeable enough to do that?
Debbie,
Guess what happens when there is no income tax?
Nobody gets free money.
There would be no lobbyists.
It would solve a lot of problems.
Jason Lol
None of which has anything to do with internet sales- Internet sales did not pick up the slack of store closures.
Let me break that down for you.
If Sears, Kmart, Macy’s ,etc completely shut down , that means the sales of another corporation has to pick up.
While there has been some transfer of those sales to other stores and online , you don’t see the balance transfer that would have occurred. So spending would have gone the same amount elsewhere as the decrease in other areas. That is not the case . Spending overall did not increase the same amount amount that it decreased at the losing stores. Spending overall is down period……….
Spending decreases have nothing to do with taxes.
Jason ,
You just randomly pick stuff and you have no idea what one has to do with another.
South Dakota has no income tax and it has plenty of lobbyists.
Corporations in South Dakota still get plenty of free money from the sales tax.
You haven’t the foggiest idea of what you are trying to convey.
When government has the power to regulate economic activity, individuals will seek to influence that power. When government has the power to arbitrarily dictate the actions of individuals, individuals will seek legislation that is favorable to them.
The logical result is pressure group politics, in which individuals band together to exert influence on legislators. Whether the group is a union, a business, or a special interest, it will claim that the “common good” or “public interest” requires legislation that provides it with special benefits at the expense of those who are not a member of that group. This is true whether the legislation prescribes or proscribes, whether the legislation confers tax benefits, or creates entitlement programs, or attempts to stimulate some industry.
Jason ,
What exactly about ND did you want to talk about ? You have to get a little specific before you can talk about the economics about it.
Thanks for proving my point Debbie. Spending and how it is done is the problem.
What is more specific than the words “cost of living” in Williston.
Cost of living has nothing to do with taxes.
Why do you think sales decreases have nothing to do with taxes-
Why do you think they do Debbie?
Please be specific in your answer.
Jason,
Thank you for making me break out my Economic 101 books – Here you go Pay close attention to the very last sentence:
The general increase in prices caused by a retail sales tax must cause a reduction of consumption, measured in physical units. /2/ This reduction of consumption is not distributed proportionately among all commodities and services, but varies with the differing elasticities of demand for the various commodities and services.
This varying reduction of consumption necessarily has its repercussions on industry and business. Decline of retail sales because of the tax-induced prices increases results in reduced orders placed with wholesalers and manufacturers. During the period of readjustment, manufacturers’ profits are generally reduced, with greatest loss to those lines for whose products demand has fallen most. Eventually, by exodus of marginal high-cost firms in some lines, by failure of the industry to expand in other lines, a new equilibrium of production and demand is established. Included in this readjustment are such changes in unit costs as are necessitated by the varying degrees of reduction and the varying cost situations of lines of production and distribution. These cost changes have their influence on prices, so that the original price pattern, initially raised with little change, is replaced by a new and different one.
The ultimate results of a peacetime retail sales tax thus are —
1. a varying reduction in the production and consumption of commodities and services,
2. a change in the price pattern
3. a higher general price level ( HIGHER COST OF LIVING JASON) bearing some relation to, but not strictly proportional to, the tax rate.
Debbie,
We already have a sales tax. You are talking about going from no tax to a sales tax. People don’t reduce spending because of sales tax.
Did the .5% increase in SD sales tax cause a reduction in SD spending? If so, please provide the evidence.
The main cost of living is housing prices. Please explain how housing prices are affected by a State having an income tax or not having an income tax?
Regarding Williston,
Why did the price of renting an apartment double overnight? The taxes didn’t change.
Jason,
Gotta ignore you buddy. You have some opinions not backed by facts or data. You are either a professional Libertarian Troll (This would be the number one guess , since you refuse to back your opinions with data) , or you are incapable of learning ( Highly unlikely since facts and data are available).
Debbie,
I understand you can’t refute my facts.
I can understand why you don’t want to discuss Venezuela and Williston.
You haven’t backed one of your opinions with fact.
I can back my cost of living and taxes fact with Williston.
The reduced spending in South Dakota is due to grain prices. That is a FACT.
You’re welcome for the education.
Jason ,
Is your IQ 40 ?
If I have $10 in 2017 and I spend $.70 on taxes that means I spent $10.30 on goods and services.
If I have $10 in 2018 and I spend $.75 on taxes that means I spent $10.25 on goods and services
Does that look like less spending on goods and services to you ?
Debbie,
Please explain how you can spend more than you have?
If you have $10, you can’t spend more than that.
The sales tax DOES NOT determine if you are going to buy something or not. That is a fact.
Jason ,
Lol to a very small extent grain is a factor but you leave out 99% of the other reasons that spending is down- Stop watching fox news and get an education.
Debbie,
You have yet to give us evidence that the reduced spending in SD is due to taxes.
Jason ,
Obviously you are intellectually diagnosed and so this conversation is something you won’t ever be able to understand . but you should understand this:
“bye Felicia”
I accept your surrender Debbie.
I just wish you would have discussed Williston and Venezuela with me.
Jason,
You don’t want to discuss anything, you want to try and outwit a MA in economics with fallacies- It’s not going to happen.
My 6th grader saw flaws in your logic, that is not a good sign for your future or your wallet.
Please explain the flaws in detail Debbie.
I will gladly discuss Williston and Venezuela with you.
Jason,
There is nothing to debate about Williston. Everyone knew long before the first drill bit hit the ground what was going to happen. That is something that is inherent to this monetary system.
Before I will discuss Venezuela with you , you would have to have an working knowledge of Capitalism and Socialism because Venezuela neither fit the description of either Capitalism or Socialism – Neither did Russia for that matter- There has not been a 100% socialist country ever , just as there has never been a 100% Capitalist country.
Debbie,
Please explain in detail how the USA had any socialism in 1790?
Jenny
With the advent of Trumpmania, it has become painfully obvious that his supporters have no idea what the definitions of socialism, capitalism, or even the difference between communism and a dictatorship.
Reading comments on Facebook or Twitter, you’ll find Trump supporters that think Russia is still a communist country.
This country couldn’t economically exist without a healthy dose of socialism, and I’m not walking about welfare for the poor. The minute this government gave a low-interest loan, provided subsidizes to farmers and big oil, started handing out tax breaks for the wealthy, the U.S. became a socialistic government and society.
Jason,
Just as I suspected you don’t know the first thing about the U.S. economic structure or where it came from , much less any other economic structure. Try reading some Hudson he should be able to catch you up from the beginning to where we are today- then come back so we can have a discussion rather than me giving you free lessons.
Jerry wrote:
This country couldn’t economically exist without a healthy dose of socialism
Prove it Jerry.
Debbie,
It’s obvious you can’t answer my question.
I would think someone with an MA in economics would be able to.
Jason ,
Whatever , you are boring me to tears. Write whatever you want it costs me nothing and means nothing , you don’t pay my check . Your poor ego needs you to win and nothing but a mental health professional can help you.
Debbie,
It’s not my problem you can’t prove what you say.
Anyone else here notice that the only thing Jason can say is prove it- like on all the blogs
Well Robin,
I prove the things I say.
Robin
That is about the extent of it. Also he thinks that asking mindless questions makes a factual argument.