PIERRE, S.D. (KELO) — Legislation that would have allowed municipalities to charge a higher tax on people who stay at lodging places has drawn the first veto of South Dakota’s 2023 legislative session.
Governor Kristi Noem announced Thursday afternoon she had vetoed HB-1109.
She took to Twitter to drive home the message, posting on her personal account an image of her using a branding iron to stamp “VETO” on it.
Republican Rep. Becky Drury and Republican Sen. Tim Reed were the bill’s prime sponsors.
It got through the House 45-23 and the Senate 19-16.
Overriding a veto requires two-thirds majorities of 47 in the House and 24 in the Senate.
The South Dakota Municipal League was a major force seeking the increase.
The league’s new executive director, David Reiss, testified against Noem’s proposal to eliminate the state sales tax on groceries. He said it would raise questions about why so many municipalities have a local sales tax on groceries.
Many smaller communities depend heavily on the grocery tax to help fund their public services.
In her veto message, Noem wrote, “The occupation tax is not just paid by out-of-state travelers. This legislation would raise taxes on South Dakotans. South Dakota residents are traveling every day for business, medical visits, youth activities, weddings – the list goes on. South Dakotans vacation in South Dakota, as well.”
The legislation would have doubled the ceiling on the tax to $4 per night and also would have allowed municipalities to charge a 4% tax instead.