Get-out-of-sales-tax-free card

The governor got it exactly right when he announced his latest $100 million in emergency budget cuts last week – this isn’t all about the deep recession. It’s also about the giveaways in tax breaks over the last several years that legislators have handed out.

If we hadn’t phased out the estate taxes and franchise fees, and if we hadn’t eliminated the sales tax on machinery and equipment, instead of facing a $400 million shortfall for next year, we would have a surplus.

The governor also hit the nail on the head when he said we have unnecessarily tripled the number of sales tax exemptions in recent years.

It is said around Topeka that all you need to get a sales tax exemption is to have a committee room and a parking space.

Any plea will do. There are no criteria. No benchmarks. No guidelines. Legislators just give away sales tax exemptions like candy, often singling out one group over others that are similar.

The chances are nil that the Legislature will put any major tax cuts, like estate taxes, back on the tax rolls. But there is a good chance they will revisit some of the get-out-of-sales-tax-free cards they have passed out.

What are these sales tax exemptions that are likely to get rolled back?

I asked myself the same question and decided to find out. I have in front of me, as I write this column, a list of every sales tax exemption issued over the past several years. There are so many, I hardly know where to start.

Let’s start with some that are in our own backyard. (I will not make any friends here, but I cannot be a hypocrite.) They all seem to be worthwhile organizations. But that begs the point: Why were they singled out?

• Rotary Club of Shawnee. Now, as a retired Rotarian, I love the organization. But why does the Rotary Club of Shawnee get a sales tax exemption for anything they may sell for a fundraiser, while the Rotary Clubs of Overland Park, Olathe, and the others have to pay sales taxes?

• Johnson County Young Matrons. This is a worthwhile organization, No doubt about it. But there are dozens, if not hundreds, of similar types of organizations in Johnson County that do not have sales tax exemptions.

• Wayside Waifs. This is a wonderful home for homeless pets that is in Missouri. How did they get a sales tax exemption in Kansas?

• Olathe Education Foundation. Again, nice work is done here, I’m sure. But what about the Shawnee Mission or Blue Valley or Johnson County Community College foundations? Why should Olathe alone be granted a sales tax exemption?

• Jazz in the Woods. I may not make any friends by bringing this up, but fair is fair. This is a fundraising event held annually in Corporate Woods. Do you know how many other fundraising events are held in Johnson County that do collect sales taxes? Too many to count.  

You get the idea. Now, you might say these small examples don’t add up to much. But they do add up, to the tune of approximately $2 million a year in lost sales tax revenue. And that’s just a teeny tiny portion of a long, long list from all over the state. Exemptions on things like lottery tickets add up to $14.5 million alone in lost revenue annually. Exemptions on sales of bingo cards are another $3 million.

There is little doubt the Legislature could find $100 million, or even $200 million in lost revenue from plugging sales tax exemptions. That would go a long way toward fixing our $400 million upcoming deficit, without having to cut education, human services or public safety.

Contact Steve Rose at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

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