HURON – If South Dakota and more than 40 other states lose the online sales tax case Attorney General Marty Jackley argued before the Supreme Court on Tuesday, Congress should finally step in and act because it’s the fair thing to do, Sen. Mike Rounds, R-S.D., said Friday.
South Dakota has been working on the issue since 2005 when he was governor, Rounds said in a conference call.
“Congress has failed to do it because there’s nothing in it for Congress,” he said.
Opponents ask why Congress should take the hit for allowing online sales taxes to be collected by states when the federal government doesn’t get a piece of the action, Rounds said.
States that filed suit against some of the nation’s largest retailers say the high court should abandon its rule that says if a business is shipping a product to a state where it doesn’t have a physical presence it doesn’t have to collect the state’s sales tax.
Rounds said states have submitted a streamlined sales tax plan and the argument of a lack of mechanics to collect the taxes has been resolved for several years.
He said Jackley did a good job in his arguments before the Supreme Court and said the questions posed by justices were not only expected, they weren’t unusual.
“The fact that they agreed to hear it in the first place tells me this is going to be a close decision,” Rounds said. “The fact is, it’s not fair” he said of the current system.
There’s no reason why Congress or the Supreme Court shouldn’t allow a broader tax base so states can increase funding for things the federal government doesn’t pay for, like education, he said.
South Dakota relies much more heavily on sales tax revenue because of a lack of an income tax, Rounds said.
“The bigger the base, the lower the rate and that’s what this is all about,” he said.
Meanwhile, all three members of South Dakota’s congressional delegation have commented this week on the status of the new Farm Bill, which has now passed the House Agriculture Committee and is on its way to the House floor.
Rounds said he is disappointed the bill doesn’t have a lot of support from House Democrats. It will need backing from both parties in the Senate because it must get 60 votes for passage, he said.
There is a desire from farm state senators to get a bill passed. The current one expires at the end of September.
“We can really do some good things in the Farm Bill,” Rounds said.
Sen. John Thune, R-S.D., a member of the Senate Agriculture Committee, said in a news release that the House committee vote to move the bill to the floor is an important step in the process.
For the past 13 months, he said he has been introducing a number of farm bill-related proposals he said he hopes are included in the Senate version.
Thune, Rounds and Rep. Kristi Noem, R-S.D, said a key component of the bill is one which increases the Conservation Reserve Program acreage cap to 29 million acres.
The bill also maintains a strong crop insurance program.
“The Farm Bill is a necessary safety net, not only for our farmers and ranchers, but for our food supply,” Noem said in a news release.
“With strong crop insurance and livestock disaster programs along with food stamp reforms, this legislation builds on the success of the historic tax cuts offered to farmers, ranchers and consumers,” she said.
Appropriate resources for farmers and ranchers are vital at a time when they have been “put on the tip of the spear” by new trade policies and a tariff confrontation with China, he said.
The country must have a good domestic policy to protect farmers and ranchers so they can stay in business while trade agreements are negotiated, he said.
There should also be strong trade policies with 11 countries in the Pacific Rim, where 500 million people live, before the United States negotiates with China, he said.
“Now we’ve taken on China and we’re not doing it from a position of strength,” Rounds said.
It is also not the time to delay implementation of a new Farm Bill, he said.