The late Will Rogers once remarked “The only difference between death and taxes is that death doesn’t get worse every time Congress meets.” Last week, we opened the 90th session of the South Dakota State Congress—or Legislature—and right out of the gate, discussion began on increased vehicle and fuel taxes.
Central to the discussion is the fact that our taxes per mile have actually been going down, especially when adjusted for inflation. But as the Federal Reserve continuously prints money, and Obama’s draconian policies prohibit more U.S. oil production, costs to build and repair roads have been going up.
There have been multiple proposals, one by a summer study group which proposed $100 million tax increase, as well as one presented by the Governor during his State of the State address, which proposed increases totaling $50 million. The Governor’s proposal includes a $0.02 increase to the $0.22 per gallon state fuel tax (about a 9% increase), with an annual $0.02 increase until it is ended by the legislature. The Governor stated that If the legislature had indexed the gas tax to inflation for construction costs, the fuel tax would be $0.45 today.
If you want to understand the Governor’s proposal in detail, I would highly suggest watching his presentation. There is link to the video and outline on my website, isaaclatterell.com.
While there are many details that should and will be discussed about these proposals, I want to share a few big-picture things I keep in mind as I seek to represent your interests. First, $100 million would be the largest tax increase in South Dakota history. Many priorities, such as Education, are just as critical to our long-term success and these have to be considered in light of each other.
Second, the reason we have these discussions at all is because the Federal Government and Federal Reserve are out of control, far beyond their intended authority. With the Fed printing money (which devalues your dollar and causes inflation), and burdensome taxes and regulation increasing the costs of everything, now is the time to pass amendments to the Constitution using Article V which will return the power to you locally.
Third, fixing roads now is projected to save money and ensure lower taxes in the long term. If we allow too many roads to fall into fair and poor condition, we could end up spending more than double on maintenance than if we keep most of our roads in good or excellent condition.
Finally, just as important as authorizing tax increases is the spending authorization. The proposal in its current form also authorizes perpetual spending authority, without any oversight by the Legislature. We need to avoid situations with little accountability that lead to corruption or favoritism. If this is not changed, I know I won’t be able to support the proposal.
In the end, I will have to decide whether to improve the proposal and support it, or oppose it and work toward a better solution next year. Most importantly, I look forward to hearing your thoughts on this proposal and any other issues we discuss this session. I can be contacted at 368-1002 or email@example.com