Sioux Falls

Sales Tax Revenue down in Sioux Falls

According to the Sioux Falls City Finance Director in the informational meeting yesterday, Councilor Brown, and the State Economic Advisor the larger cities in South Dakota are seeing a decrease in retail tax revenue and the smaller towns are seeing an increase. They seem to be puzzled why this is. Brown seemed to think it was the rural economy doing well.

I’m gonna guess he is wrong.

I’m not an economist, and trust me, I haven’t really done much research on this after hearing about this development, but I’m gonna guess that it is due to high gas prices and inflation. Used to be small town people would go to the big city on weekends, buy all their groceries, buy clothes and fillup their tanks. I know this because we used to go to Mitchell every Saturday to do the same thing growing up (I lived in rural Ethan). With inflation people are cutting back on buying luxuries in the big cities and buying groceries in their hometowns to save gas.

This may not be good for Sioux Falls, but it is good for smaller towns because it may help to revitalize them.

Why I opposed the Sales Tax increase

Matt from the Argus Leader wrote a great column about the sales tax increase. Though he makes some good points he missed why some of us opposed the tax. I opposed the tax because I feel the city has made very poor choices in the past 6 years when it comes to road funding. Our tax revenue has doubled in the past decade, yet our retail tax rate has not decreased and we are behind on road construction. What does this mean? It means our city is not spending our money wisely. With that kind of revenue increase we should be driving on well maintained and new roads or our taxes should be low – neither is true. Now that the National economy is tanking it has become more evident that a sales tax increase will be an extra burden on SF residents.

I have often thought that if politicians use common sense when they make decisions, they will make good decisions, when do not use common sense they make dumb decisions. The sales tax increase was not a common sense decision.

Get it dummies?