Rapid City Journal, Rapid City, Jan. 15
Amazon’s decision benefits all S.D. residents
On Tuesday, Gov. Daugaard hailed the decision by online retail giant Amazon to begin collecting sales taxes on purchases made by South Dakotans. By Tuesday evening, more than a few state residents made it clear they did not share the governor’s enthusiasm for the news.
Some even went so far as to cry “foul” when they learned that a loophole created by a 1992 Supreme Court decision will be closed on Feb. 1 in the state. The decision in the Quill Corps. v. North Dakota case meant that online companies were not required to collect sales tax in states where they had no physical presence.
Clearly, a lot has changed since 1992 when the digital economy was in its infancy. In fact, it wasn’t until 1994 that Amazon emerged as an online bookseller. Today, the company has 180,000 employees and plans to add another 100,000 over the next 18 months as it is on its way to becoming the second largest employer in the nation after Wal-Mart.
But Amazon’s role in changing the retail landscape is hardly a secret. Many if not most of us have shopped on the company’s website, which offers an endless array of merchandise to purchase. As an added bonus, South Dakotans have been able to skip paying sales tax when they made a purchase from Amazon even though there is a state law that says they are obligated to pay up.
The decision to circumvent that law, meanwhile, has cost the state millions in tax revenue, money that otherwise would have been collected if the products were purchased at a store in South Dakota.
The decline in sales tax revenue due to the internet economy is especially harmful to a state like South Dakota that does not have a state income tax, a corporate tax, and an inheritance tax. As a result, a decline in sales tax revenue will eventually have a huge impact on even basic government services like public safety and education.
In addition, the now antiquated Supreme Court ruling gave an unfair competitive advantage over local stores and retailers that not only collect sales tax but pay property taxes, employ local residents and in many cases re-invest into the community.
It’s also important to note that Amazon is not the only online retail business that has agreed to collect sales taxes on items purchased by South Dakotans. As a result of a law passed last year in the Legislature that required certain online companies to collect the sales tax more than 100 businesses have started doing so, according to the governor.
The collection of sales tax should not be controversial. Everyone needs to pay their fair share or we all could suffer the consequences in the long run.
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American News, Aberdeen, Jan. 18
Signals softly sound for better times for SD economy
Each state government has star performers when it comes to generating revenue.
In Minnesota, it is state income taxes. In North Dakota, it is oil and gas industry taxes.
In South Dakota, it is sales taxes. The state gets about $1 billion of its $1.6 billion in revenue from sales taxes.
State sales taxes are lagging in South Dakota. Revenues are likely to finish $26 million below the estimate for the current fiscal budget year that runs through June 30, 2017.
Gov. Dennis Daugaard and state officials are working on the problem. In true Daugaard fashion of cautiousness and conservatism, the governor Monday told the American News editorial board he thinks things may slowly start to turn for the better.
Based on his track record, we took the governor’s message as cautiously status quo rather than cautiously optimistic.
Wrapping up his next-to-last year as governor, Daugaard and his way of “promising less and delivering more” is just what this state needed at times during his two terms and what will be eight years in 2018.
On Monday morning, Daugaard talked about the state’s new written contract with online retail giant Amazon to begin collecting state and local sales taxes on purchases in South Dakota. But how much it will help is up in the air until the state has a year’s worth of history of the collections.
Amazon will begin voluntarily collecting state and local sales taxes Feb. 1 and will remit them starting in late March, Daugaard said.
This won’t solve the state’s lagging sales tax problems, but it is certainly a step in the right direction. The governor said statistics show Amazon has about a 30 percent share of the online retail market.
However, since Amazon will not share its history of sales numbers in South Dakota, the full impact won’t begin to reveal itself until the state has 12 months of collections under its belt. The state also has been asking other online retailers to collect state and local sales taxes, and more than 100 have agreed to do so, Daugaard said.
State officials and South Dakota business owners hope more online companies will volunteer to begin collections as well. That will help level the playing field for competing South Dakota businesses who are sometimes at a 6.5 percent pricing disadvantage right out of the gate when they collect local and state sales taxes to purchases.
But there are some big-company holdouts on volunteer collections such as eBay, Wayfair, Newegg and others. Such companies can stand behind a 1992 U.S. Supreme Court decision that bans states from forcing out-of-state retailers to collect taxes if they don’t have a physical presence in the state.
Daugaard hopes that will be an overturned Supreme Court decision in the future.
The governor also said some of the state’s leading historical indicators are showing signs that the downward sales tax trend may turn around. One such indicator is non-farm employment.
“Since I’ve been governor, we have never had a year, with maybe one exception, where we have had a bunch of consecutive months (this year) where non-farm employment growth has been over 2 percent … That is very unusual. You have to go back to 2006 to find that kind of non-farm employment growth.”
Another leading indicator, non-farm income, has been strong as well. “So our economists . believe that we will see some strengthening of our sales tax figures even though they have been weak so far,” Daugaard said.
The governor also said there might be indications signaling good news eventually for the all-important state farm economy that has been slumping: Inventories of some farm goods have been going down, which usually creates a demand. Normally when there is a demand, prices increase.
The governor said current prices for some farm products are hovering around 2010 levels. But he said when prices later soared - like $8 per bushel corn in 2012 - some farmers used the good times to pay down their operating debt and strengthen their balance sheets “until the good times return, and hopefully they will.”
The governor said in his talks with ag bankers, there are no major alarms going off. “There is an understanding in the ag community, that (these hard times) happen from time to time.”
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The Daily Republic, Mitchell, Jan. 17
Self-assess screen time for children
Are parents today allowing tablets and TVs to raise their children?
Perhaps some are, and we hope those people take notice of a new recommendation released by the American Academy of Pediatrics that show the acceptable amount of screen time for young children.
Late last year, the American Academy of Pediatrics explained children younger than 18 months should not spend any time in front of a tablet, TV or smartphone. The recommendation went on to say that children 18- to 24-months-of-age should only spend time watching high quality programs with their parents, and media usage for children 2 to 5 years old should be an hour or less per day.
In today’s ever-advancing technological world, we’re worried that parents aren’t watching their children grow up. Rather, many parents are watching their young children bury their faces in iPads, computer screens and televisions.
There’s no doubt programs like Sesame Street and shows made by Disney can help the development of a young child. In fact, if parents choose to let their children spend time on a tablet or in front of the TV, we hope programs like those are the ones of choice.
But rather than banking on Elmo and Mickey Mouse to teach your child colors and shapes, here’s a thought: Spend some time with your kid.
Especially true is spending time reading to them. It’s widely accepted that reading aloud is the single most important activity leading to language development and promotes early literacy skills.
What kid doesn’t like coloring? Show us a child who doesn’t want to play with blocks. Expand your child’s imagination.
Certainly we’re not saying that screens are bad for children - there’s definitely educational value that comes from technology. And we want our children to keep up with the advances. It really is amazing to see how so many children 2 years old and younger can efficiently operate a tablet and the apps on it.
Instead, we’re recognizing a much-needed study done by the American Academy of Pediatrics and hoping parents utilize the recommendation. Children, if left alone, will stare at screens for hours on end.
That’s why we hope parents, at the very least, self-assess how much time they’re allowing their children to spend on tablets, iPads and other screens.
There’s so much more for children to do.
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