Business forum: Taxing business services is bad for Minnesota

  • Article by: Tom Salonek
  • Updated: February 10, 2013 - 2:40 PM

Gov. Dayton’s proposed B2B tax would hobble services companies and cost the state jobs.

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slericksFeb. 11, 13 7:00 AM

I agree with the content of this article. However, much of what the author states applies to large companies also. We have lost the headquarters operations recently of some of our biggest companies. Honeywell, The St. Paul Companies and Delta to name a few. The important point that the author makes that needs to be remembered is that states are in competition with one another for new investment, employment opportunities and new residents. The governors mix of tax and spending proposals will hurt Minnesota in the long term.

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hjlazniFeb. 11, 1310:39 AM

Instead of increasing taxes, the wealthy borrow the government money to be repaid plus interest to the wealthy. Then we borrow more money from the wealthy to repay the Wealthy the money we borrowed from the Wealthy plus interest instead of raising taxes. If revenue to the Government is down, the wealthy borrow the government money to be repaid plus interest to the wealthy. At some point, the Wealthy and the Government have to agree that the Government will have to pay the Wealthy back at another time, when revenue is up and the Wealthy holding Government debt may have to take a haircut, or we can go back in time to recalculate taxes on the wealthy to pay the wealthy back the money they borrowed to the government plus interest because austerity generates a new recession.

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edcommentFeb. 11, 1311:10 AM

The question I have is not whether or not these transactions should be taxed but, why haven't they been taxed all along? Who realized we had all this business being conducted without any contributions to the overall fiscal health of the state? And, do Salonek and other "service" providers see that charges for their services are discounted in MN in order that we all benefit from the savings of having no tax on these transactions? I doubt it. Or, do he and other service providers excuse MN from providing safe streets and highly maintained roadways or will we be exempts from improving our schools compared with states in which their services are taxed? I say tax 'em. We are all in this together or were not. Let's decide. And, if this theory about states competing were really true, why are so many corporate headquarters located in New York? Why have they stayed there no matter what the tax? We can't out Arkansas Arkansas.

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rickzieserFeb. 11, 13 1:16 PM

Isn't it amazing and funny when the Red Star comes out against a tax increase on services which includes "Advertising" which they are heavily involved in. I thought that our Governor was lauded as bold and courageous when he wanted to raise taxes on everyone else. How hypocritical can a paper be? The truth is that raising taxes on anyone in this state will cause economic damage. What the governor and the Dem legislature are proposing will hurt Minnesota.

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richnpoorFeb. 15, 13 3:04 PM

Good article, Tom, and I agree 100%. As another small business owner, I'll explain why these taxes have not been charged, @edcomment. First, income that businesses receive from B-B transactions is already taxed, at a higher rate than sales taxes. Tacking on another tax is doubling up on taxes to businesses, both small and large. Second, when we sell goods (not services) to customers the sales tax is charged. Third, as Tom explains well, the added tax puts Minnesota companies at a disadvantage compared with other states and countries. What MN and the federal government need is to spread the tax burden better, and for the middle class to share a bit in higher taxes. Putting the burden on only a portion of society is a temporary fix at best. BTW, I'm a Democrat.

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