Voluntary tax increase

An election shocker that isn't getting much attention: In Minnesota, voters approved a three-eighths percent increase in the sales tax to fund projects for wildlife, clean water and lakes and the arts.

When I saw the proposal on the ballot, I was surprised. I voted no, simply because I am not a fan of the sales tax. It is regressive, punishing those with lower incomes at a greater rate than those with higher incomes. If people want money for these projects, run it through the legislature and raise the income tax, not the sales tax.

The measure passed, and big! And it will raise $275 million per year.

It amazes me. People have no problem raising their sales tax, which nickels and dimes them to death, but will refuse to raise the income tax, which hits them once per year. It is a matter of psychology more than philosophy. People prefer the sales tax to any other.

The sales tax was raised to 6.5% many years ago to solve some budget crisis. The thought was, if I remember correctly, that it would be lowered to 4% when the crisis passed--which, of course, never happened.

Ratcheting up the sales tax has the effect of hurting towns on the border with lower tax states. Although North Dakota is now sitting at 6.5%, they could lower or eliminate their sales tax and gain a competitive edge. North Dakota's oil money might allow them to do just that, although I suspect their voters are just as in love with the sales tax as Minnesota's.

I once introduced a resolution at the county convention of the DFL to eliminate the sales tax and make up for the lost revenues by increasing the income tax. I pointed out the issue of fairness.

My resolution was defeated on an almost unanimous and very loud voice vote.

So, there you go. The people of Minnesota surprised me in a pleasant way by approving a tax which stands to improve our quality of life. But they disappoint me every time they exhibit the short-term thinking which says, "Nickel and dime me to death, if you please, but don't raise my income tax!"

There are those who think tax should be levied on consumption, not income. I could perhaps be convinced in that direction, since I prefer making money to spending it. But my gut tells me that the fairest tax of all is a gently graduated progressive income tax. The least fair tax of all is the property tax, since it taxes you whether you make anything or not from the property in question. But the sales tax isn't far behind.

And yes, I do agree with Joe Biden that paying taxes is patriotic. Just spend it carefully and wisely, please!