here are many things about Gov. Dayton’s budget plan to dislike. But allow me to discuss one of his proposals that could sound the death knell of business in small communities all over the state—Winona included.
The governor has suggested in his budget that the state tax clothing and many services that as of now are not taxed. The tax on clothing will take away any advantage that Minnesota retailers along the borders have now, as well as add to the cost we pay for clothing (something that is a necessity in this climate). The tax on services will add even more to an already onerous burden on low and lower-middle income earners for services that they use more than higher earners, such as auto repair (and taxis when your car doesn’t work), and household goods repair and maintenance. There will also be a tax on accounting services to prepare taxes and on legal services. Let’s not forget the proposed tax on your haircuts. Sales taxes by their very nature hit lower income households harder, because those lower earners are then paying the exact same tax percentage as higher earners—or the wealthy, if you prefer.
The small businesses that occupy downtowns and neighborhoods in the Winona area will have their cost of doing business raised. “They’ll just pass it on to their customers!” you say. In most cases that’s right. And you are those customers. Very small businesses could very well go under.
Businesses are affected by Gov. Dayton’s sales tax proposals in yet another way. The governor is proposing to add a sales tax on advertising. That is a direct cost to businesses to tell you what they have for sale and what deals they are offering you. Businesses could simply pass the cost on to the consumer—you. Or, they could cut back on advertising.
“Aha!” you say. “She’s afraid she’ll lose money.” Sure I am. The governor also proposes a tax when you buy a newspaper, which presents a double whammy on subscription newspapers, such as the Winona Daily News. The Winona Post is free circulation, so we wouldn’t pay a subscription tax. All newspapers rely on a way to deliver the news, though, and the governor is proposing to tax delivery systems, as well.
However, there is a bigger picture. If newspapers, especially small town newspapers, like the Winona Post and Winona Daily News, are taxed to the point where they lose advertising and subscriptions, suddenly the funds needed to publish the paper have disappeared.
Why should you care? Can’t you simply get local news on the Internet, so you don’t need a newspaper? The Internet isn’t produced for free, either, and the best local news sites are most often the products of local print newspapers. Reliable news isn’t generated without paid reporters. In a small town, that is especially true. Local news isn’t easy to find generated anywhere else but at home. If the local newspaper disappears, local news disappears from the Internet, as well.
Without a community newspaper, citizens are left in the dark. They won’t know what local government is up to. They won’t read about their neighbors in the birth announcements, obituaries, school news, or sports. There won’t be a forum for community discussion. Citizens will be reliant on political pamphlets handed out by candidates, instead of open discussion of candidates’ views before elections. They will miss news of upcoming events—sporting events, art, music, and theater presentations, school and church celebrations. Local grocery stores and other retail outlets won’t be able to rely on sharing their weekly news with all area consumers. Local employers won’t have a vehicle to let job seekers in a specific area know of their employment opportunities.
Essentially, without a vehicle for local news and advertising—the community newspaper—there isn’t much of a chance to hold together a community. This is especially true in small markets like the Winona area.
And without businesses occupying real estate in our small communities, the tax base begins to erode, and the cost to residents for essential services will increase.
Governor Dayton’s budget is bad for small town Minnesota—outstate, as they call it at the Capitol. It would do the governor and metro legislators good to get out of the Twin Cities more often to see how the other half lives and what their budget will do to our way of life, our community.