Republicans propose using sales tax money for new tax cuts

JEFFERSON CITY, Mo. – A Supreme Court ruling making it easier for states to collect online sales taxes could yield billions of additional tax dollars. But some states may not keep it.

Rather than spend the windfall on schools or government services, some Republican governors and lawmakers are proposing to give it to residents in the form of additional tax cuts. Some are suggesting income tax cuts. Others want to reduce food sales taxes or offset local property taxes.

The Supreme Court ruled June 21 that South Dakota could enforce a law compelling many out-of-state businesses to collect taxes on sales made to its residents. The ruling overturned a decades-old precedent stating that businesses without a physical presence in a state didn’t have to collect sales taxes on behalf of the state.