South Dakota legislature passed a property tax cut of $104 million per year, decreasing the taxes on groceries but not eliminating them, as urged by Governor Kristi Noem.
The tax cut would reduce the state’s overall sales tax from 4.5% to 4.2%. The bill will expire after four years and removed the Partridge amendment mechanism – which gradually reduced the state’s sales tax as more money was collected.
Tax cuts were among the priority agenda as the legislature opened the session with a $423 million surplus.
AP News reports Governor Noem, a potential contender for the 2024 presidential nomination, has made the grocery tax her centerpiece for her reelection campaign. South Dakota is among the few states that tax general sales, including groceries.
Governor Kristi Noem, a potential contender for the 2024 presidential nomination, passed the property tax cut as part of her advocacy and reelection campaign. (Photo: Stephen Groves | SDPB)
See: South Dakota Gov. Kristi Noem Proposes to Eliminate Grocery Store Taxes
According to Fox Dakota News Now, the house has also passed a clean general sales tax cut bill, where they added a “sunset clause” to the original sales tax cut bill. The updated bill would last until 2025.
Both Houses support the newly passed property tax cut bill. Republican Senate Majority Leader Casey Crabtree said the property tax relief is expected to distribute to 245,302 households or a rebate of $425. On the other hand, Democrats supported the grocery tax cut for a long time. Democratic Senate Leader Reynold Nesiba was pushing for a tax cut on food and hoping to retain the general sales tax to fund state employees, community support providers, and education. However, his plan was rejected for a second time.
