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Sales Taxes for Local SD Projects?

November 23, 2009

SIOUX FALLS, S.D. - If state lawmakers and local voters approve, cities across South Dakota could fund local projects with a one cent sales tax increase. Sioux Falls is already making plans to build an arena with nearly $170 million of such money. Backers of the proposal say it would bring more activities to the cities and more jobs.

Critics of the tax increase, however, warn it would put a burden on the community's poorest citizens. One opponent is Cathy Bretchtelsbauer, state coordinator of Bread for the World.

"This is a moral issue. Raising the sales tax would raise the cost of living, but a lot of South Dakotans just can't afford that. Wages are low in South Dakota."

Bretchtelsbauer points out that a local sales tax is not the only revenue option.

"Cities have other ways to raise funds. If they want to do a new city project, that's fine. Just don't ask hungry children or struggling families, the elderly, the disabled, the nursing homes to pay for it."

There have been proposals of a refund to offset the tax, such as the Food Tax Refund Program, but such programs would miss people in need and would not reach most low-income people, she says.

Dick Layman, Public News Service - SD