Kelliher: repeal telecommunications tax

This headline might startle Republicans:

DFLer Kelliher aligns with state Republicans on tax repeal push

While it’s nice having another Democrat agree with Republicans that raising taxes is a terrible idea, this isn’t that surprising:


Former Speaker of the House Margaret Anderson Kelliher, a Democrat who is one of the state’s leading broadband advocates, agrees with Republican leaders that Minnesota should eliminate a new sales tax on telecommunication equipment purchases.

Here’s why this isn’t surprising:

Margaret Anderson Kelliher speaks at the DFL victory party and shows her support for Mark Dayton on Tuesday, Nov. 2, 2010. A Democrat and former House speaker who now chairs Gov. Mark Dayton’s Broadband Task Force, she is aligning with Republican lawmakers in their opposition to a new sales tax on telecommunication equipment purchases.

It isn’t a stretch to think Kelliher wouldn’t push for this tax increase repeal if a) she didn’t think the tax increase was a political loser and b) her ox wasn’t getting gored.

Tim Pugmire’s report said that Kelliher wrote Gov. Dayton a letter about her opposition to the telecommunications sales tax. In that letter, Kelliher said that imposing a sales tax would raise the cost of installing broadband, causing companies to spend less on that type of infrastructure.

First, it’s important to understand that sales taxes are inflation-creating taxes. It’s impossible to argue that sales tax increases don’t raise the price of something. When we’re talking about major investments in broadband, the cost of a project increases significantly.

Second, it’s impossible to argue that higher prices won’t affect how many projects will be worked on. Expensive project equals fewer projects.

Third, the fact that the DFL didn’t think this through is proof that they’re the party of raising taxes first, then worrying about the ramifications later. Democrats, from President Obama to Gov. Dayton, have preached about the need to make broadband the standard for the nation and Minnesota. The telecommunications sales tax that Gov. Dayton just signed into law insures fewer broadband projects will get worked on.

It’s another case of Democrats saying they’re for something, then implementing a law that thwarts that something from becoming reality.

The good news is that there’s a short-term solution, a mid-term solution and a long-term solution to this foolishness. The short-term solution is to get into a special session and repeal these taxes. The mid-term solution to this problem is turning Gov. Dayton into former Gov. Dayton and turning Speaker Thissen into Minority Leader Thissen. The long-term solution is by turning Majority Leader Bakk into Minority Leader Bakk.

That’s the only way we can repeal the DFL’s counterproductive tax increases and reverse the DFL’s foolish spending spree. That’s the only way Minnesota can legitimately say that we’re open for business.

Cross-posted at Let Freedom RIng