Column: Why wait to eliminate bad warehousing tax?
Recent news reports suggest the Minnesota Legislature may soon be called into a special session by Gov. Mark Dayton. Apparently, the only topics he wants addressed are disaster relief and the repeal of a sales tax on farm equipment.
This makes no sense to me for a number of reasons.
I am all in favor of helping out Minnesota’s storm victims. If we have people struggling due to natural disasters, the Legislature should give them needed assistance as quickly as possible.
Now we have the obvious admittance by the Democratic-controlled Legislature and the governor that raising taxes was not only a bad idea, but one that was poorly thought out. Dayton himself called it “bad legislating.”
Continuing on with his farm equipment sales tax commentary, the governor admitted it was sneakily added to a massive tax increase bill at the end of session, calling it “a very bad mistake” while claiming he and his staff were “not aware of it.”
All of the governor’s comments could just as easily be applied to the new and unnecessary warehousing tax.
Yet despite the fact every lawmaker will soon be sitting in St. Paul to repeal one haphazard tax increase, Dayton is refusing to do the same with the warehousing tax, even though it is universally despised by all sides.
This provision, added at the last minute as Democrats needed to find additional taxes to raise on Minnesotans in order to pay for $3 billion in new spending initiatives, imposes a 6.875 percent tax on general product warehousing and storage at bulk shipping terminals, such as railroads and commercial docks.
Border communities like ours are significantly impacted as a business can simply find a different storage or repair service in neighboring states to avoid this ridiculous tax, which takes effect April 1, 2014.
So what’s the rush to repeal the warehousing tax law?
A number of area businesses have told me how irritated they are with this new law, as they are putting together their business plans for the next few years and in many cases are determining whether to expand their workforce and operation. This tax will cut into their bottom line, and they need to know that it will be repealed before moving forward with their investment.
Investments, I might add, that will financially benefit the state of Minnesota and help improve our economy.
I’ve had a bill drafted for several weeks now that would repeal the warehousing tax and I’ll be ready to introduce it in special session.
Governor Dayton came out last week and told the press he is now in favor of repealing the warehousing tax.
So I ask once again, if legislative Republicans and Democrats and
Governor Dayton all agree that the warehousing tax needs to be repealed, then why wouldn’t we try to be efficient for once and get rid of a law that has already put business and new jobs on hold in this state?
The only reason to allow this unnecessary warehousing tax law to continue is through blatant partisan stubbornness.
All sides are going to come together in bipartisan fashion to approve a disaster relief plan, and repeal a farm equipment sales tax, when Dayton decides to call a special session; there’s no reason we can’t do the same for the warehousing tax.
Tim Kelly, R-Red Wing, can be reached at 651-380-4345 or email@example.com.