The South Dakota Retailers Association and our nearly 4,000 member businesses encourage South Dakota voters to join us in opposing Initiated Measure 25 (IM-25).
We have a first-hand understanding of South Dakota’s workforce development needs, and we agree that more affordable tech schools may be part of the solution to those needs. But IM-25 is an expensive and fatally flawed response to our state’s workforce development issues.
IM-25 fails on three counts: it is a substantial tax increase on South Dakota consumers that will damage main street retailers who serve those consumers; it is not designed to ensure newly educated workers stay in South Dakota; and it takes much more money from taxpayers than even its proponents claim is needed.
Consider:
South Dakota’s population is concentrated at its southeastern borders. Consumers in the most populated area of our state have easy access to Iowa and Nebraska retailers. Should IM-25 pass, those out-of-state retailers will be more than happy to undercut our members and sell tobacco products for $10 to $18 less per carton. Montana, Wyoming, and North Dakota will also reap the benefits of a substantial price advantage over South Dakota retailers, thanks to IM-25.
IM-25 proponents claim we need to lower the cost of technical education in South Dakota to better compete with schools in surrounding states. But tuition cost is only half the picture; nothing in IM-25 requires student recipients of these funds to work in South Dakota once they’ve completed their taxpayer-subsidized education.
IM 25 is projected to take at least $25 million per year from South Dakota taxpayers. Yet, 20 percent of the money from this tech school tax is not even slated for tech schools – it will simply be poured into the general fund.
In addition to these problems, IM-25 sets a bad precedent that threatens our state’s business-friendly climate. Passage of IM-25 will pave the way for others to use the initiative process to target new taxes at select groups and dedicate revenues to fund their favorite programs. The legislature, not the ballot box, is the appropriate forum for addressing our state’s tax and spending policies.
Our association has a proud history of advocating for the policies that are the foundation of South Dakota’s well-earned reputation as a business-friendly state, including broad-based taxes carefully calculated to take only what’s needed to run a lean, efficient state government. IM-25 flies in the face of those pro-business policies; it does damage to South Dakota consumers and retailers with no corresponding benefit for South Dakota businesses.
We hope South Dakota voters will join our members across the state, South Dakota’s two political parties, and countless other businesses and individuals in rejecting IM-25 as a costly and ineffective answer to our state’s workforce development challenges.
South Dakota Retailers Association Board Members:
