SUPERIOR, WI (WTAQ) - Minnesota’s governor has created some interesting buzz in Duluth-Superior with his tax proposals.
Governor Mark Dayton wants the Gopher State to slap sales taxes on items that are not taxed now – like legal services and clothes that cost over $100.
The Duluth News-Tribune says some folks on the Minnesota side are nervous about losing business to nearby Superior Wisconsin.
Mainstreet Fashions for Men in downtown Duluth sells a lot of nice clothing to Wisconsinites who cross the border to avoid their home sales tax on clothing. And co-owner Doug Melander fears losing that business.
Superior used to have a thriving apparel sector, before Wisconsin decided to tax clothes in 1962. Today, Kaye Tenerelli of the Superior Business Improvement District says most folks simply drive the six miles to Duluth to buy their clothes tax-free.
Walmart and Target are about the only stores left in Superior that sell clothes – so obviously, folks on the Wisconsin side will watch the Minnesota tax debate with interest.
Also, attorneys in Duluth fear that they’ll lose business to tax-free lawyers in Superior. But Minnesota’s assistant tax policy commissioner, Susan Van Mosch, says that if any service is used in the Gopher State, the buyer must pay the sales tax – no matter where the service was purchased.
Wisconsin has had problems enforcing the state sales tax for Internet purchases – but Van Mosch says it’s easier to enforce direct business transactions, because companies like law firms are audited more often.