South Dakota Hall of Fame: Established in 1974 to recognize and honor those individuals Championing a Culture of Excellence for all of South Dakota.
It was called a “liar’s tax” and for good reason.
People — not you, of course — but perhaps your neighbors, omitted valuable personal property when filing their tax form to the State of South Dakota.
It might be a diamond ring. Or a new stereo system or washing machine. Household equipment, personal effects, and sporting goods all were subject to the tax, which generated $40 million a year for state coffers.
A man who was instrumental in ridding South Dakota of this universally hated tax will be inducted into the South Dakota Hall of Fame this fall, but not just for his work on taxation. Nor did he need this latest honor to be well known.
He is former Gov. Harvey Wollman, who recently turned 82, and is still as sharp and articulate as when he served in leadership in the state Legislature. He became the state’s 26th governor (and only the state’s fifth Democrat governor) when his predecessor, Richard Kneip, resigned to take an ambassador’s post in Singapore.
When the personal property tax was repealed in 1978-79, it created a huge revenue hole, much of which was recovered by broadening the state’s sales tax and increasing license fees and the taxes on banks and contractor services.
Wollman chuckled when we visited about it recently.
“What happened to make that possible was during the (President) Carter years, we had very high interest rates and a lot of inflation and sales tax collections just ballooned.”
It set the stage for the repeal of a tax that citizens despised and neither political party supported.
In those days, retail business would have “inventory reduction sales” and ranchers and farmers would sell livestock before a certain date. “Everybody hated the tax,” Wollman remembered.
It also was during the Wollman years that South Dakota came within a vote of establishing a state income tax. At Kneip’s initiative, the bill passed the House but stalled in the Senate on a 17-17 tie. Kneip’s running mate and lieutenant governor, Bill Dougherty, president of the Senate, opposed it, which was as close as the state ever got to implementing the tax. Dougherty went on to unsuccessfully oppose Kneip in the next primary and Kneip replaced Dougherty with Wollman on the Democratic ticket.
Wollman, of rural Frankfort, was the state’s last Democratic governor. If it seems like a long time ago, it was: nearly 40 years. To Democrats, it must seem like an eternity.
May 31, 2017