In their dog-and-pony slideshow presented to the Legislature’s property tax task force this summer, sponsors of a proposed initiated amendment to ban property taxes and replace them with a retail transaction tax claimed that their new tax “would completely cover the annual total of property tax revenue in the state.”
Bullshit, says the Legislative Research Council:
For taxes payable in 2027, political subdivisions (schools, cities, counties) will likely see a total reduction of ($2.018) billion in property tax revenues. The retail transaction tax will likely generate $1.167 billion in revenue annually. This change creates an estimated net loss of ($850.3) million in funding for political subdivisions [Legislative Research Council, fiscal note, 2025.10.29].
The LRC fiscal note, issued Wednesday, says taxing folks $1.50 for every trip to the cash register would only yield only 58% of the cash we currently get from taxing houses, shops, and farms to pay for schools, snowplows, and sheriffs.
Abolishing property tax and relying instead on a retail transaction tax means 42% less money to pay teachers. 42% fewer bridges fixed. 42% fewer potholes filled. 42% fewer fires put out. 42% less of everything you depend on your cities, counties, and school boards to do.
SDCL 2-9-30 limits the LRC fiscal note, which must appear on the initiative petition, the Secretary of State’s ballot question pamphlet, and the ballot, to 50 words. But LRC director John McCullough attaches his fiscal note to a two-page letter to the Secretary of State and the amendment sponsors explaining the data, sources, and assumptions the LRC used to reach its conclusion. Their figures and guesses differ from mine, but the LRC agrees with my analysis that this amendment would devastate local government budgets.
So if this petition hits the streets, be sure to ask the petitioners what they think will happen to schools, streets, and police departments if we cut their budgets by 42%.
I guess they plan on taxing drinking even more. The last business in town is the bar.
Drink up small towns and villages. It will pay for everything. The lottery will help too, just buy twice as many tickets for sure. Now if you’d just make Mary Jane totally legal just think of the taxes that could raise and the peaceful villages it would create. Wow!