A study recently released by the Tax Foundation found that Montana has the eighth-best business tax climate in the nation.  That top 10 status is due in large part to Montana’s lack of a sales tax, according to leading in-state business organization that bills itself as “the driving force in promoting a favorable business climate.

The eighth-best ranking is one that the Montana Chamber of Commerce says is something they’ll “promote the heck out of” when attracting companies to do business here, but that ranking that would be lost if Montana instituted former Congressman Rick Hill’s sales tax.

According to a story in Lee Newspapers, Webb Brown, President of the Montana Chamber of Commerce, said the Tax Foundation gives a lot of credit in its rankings to states that don’t have certain major taxes, such as general sales taxes or individual income taxes.

“Not only would Congressman Hill’s tax-hike take money from the wallets of middle-class Montanans, it would make it harder to create jobs, allow Montana businesses to expand and attract businesses to invest here,” Montana Democratic Party Executive Director Ted Dick said.

As one of the leading contenders for the GOP nomination for Governor, insurance-executive Hill has been a strong supporter of a sales tax.  Hill was the lead lobbyist in the 1993 Montana Legislative Session to put a $400 million tax increase on the ballot – which is over $620 million in today’s dollars.  More recently, Congressman Hill has advocated  for a sales tax as a candidate for Governor.

Governor Schweitzer sees Montana’s standing as one of America’s best business tax climates only getting better, telling reporters that the several states ahead of Montana in the rankings may be looking to raise taxes because they lack the financial stability we enjoy.  Moreover, Montana has cut taxes, like the business equipment tax, this year – which will also play into future rankings.

That may all be lost if Hill is able to ram through his sales tax.

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Hill Lobbied for $400 Million Sales Tax, $72 Million Income Tax
During the 1993 legislative session, Hill lobbied to pass two measures that would drastically increase taxes on Montanans.  The first measure was a bill to place a $400 million sales tax measure on the ballot.  It was rejected by the voters 75% to 25%.  Hill also lobbied on behalf of a bill that would have increased income taxes by $72 million, but was again rejected by voters. [Billings Gazette State Bureau, 5/23/1996]

Hill Still Supports a Sales Tax
INTERVIEWER: You would support a sales tax as a substitute tax, you would be open to that?

HILL: I would be open to it as a substitute tax. [Voices of Montana, 8/18/2011]

“A lot of people have advocated in Montana for a long time that we need three stools to our tax structure; got to have the income tax, the property tax, and the sales tax. I have often been an advocate for sales tax as a substitute.” [Hometown Helena, 6/2/2011]