Close the flap on 'box store tax'

Sure, it would be easy to pick on "box stores" by slapping them with a tax. But that tax plan comes with a cost, which is evident with Costco's announcement last week that it is suspending planned capital investments in Montana because of a proposed box-store tax.

More specifically, the company is holding off on its well-publicized plans to build a bigger store north of Kalispell while the state Legislature is considering a tax proposal by Sen. Ken Toole, D-Helena.

Toole says he hopes to shift Montana's tax burden - providing breaks for residential property taxpayers at the expense of box stores - and he wants to make money available for the state's education system.

While those end goals may be worthy and beneficial for Montanans, the big box tax is a bad idea for several reasons. The biggest reason is that it could easily impact economic growth, right here in the Flathead Valley.

It can be argued - and Toole does argue - that box stores are an undesirable form of economic growth. They can drive family businesses out of work. They don't pay employees as much as would be desirable, they have a lot of part-time employees, and all of that can result in box store employees relying on the state's social services more than they should, Toole contends.

But we suspect a person could come up with a list of cons for most business sectors in Montana and conveniently disregard any positive contributions they make.

Even Toole should be able to recognize that box-store companies do indeed make a contribution to their communities. To start with, they pay handsomely for construction contracts that are temporary, but which can account for the largest projects carried out in a Montana county in a given year. They also provide a number of management and full-time jobs that can pay relatively good wages. And they already do pay taxes, especially property taxes that support local government and schools.

The biggest problem with throwing another tax at box stores is that it is counter-intuitive in a state where citizens have grumbled about a lack of economic development for the last couple of decades.

There have been steady, incremental changes aimed at improving Montana's "business climate," and we think those changes are yielding results.

The last thing we need are taxes that are patently targeted at one of the most active segments of the economy. If the new Costco store is abandoned as a result of the only known "box store" tax in the nation, it will make a difference in Flathead County.

The president of Jobs Now, a local economic development group, summed up what is probably the worst aspect of the tax: "It does nothing to enhance our statewide reputation as a reasonable place to do business."

Let's not send mixed messages.