SIOUX FALLS, S.D. (KELO) — South Dakota voters could decide in November 2024 to repeal the state’s sales tax on groceries; the organization Dakotans for Health can now begin collecting signatures for the effort.
Democrat Rick Weiland of Sioux Falls is co-founder of Dakotans for Health and sponsor of an initiated amendment and initiated measure which could repeal this tax. The initiated amendment would change the state constitution, while the initiated measure would change state law.
“This is such a regressive tax, and I think Governor Noem saw that when she was campaigning, and it disproportionably affects low-income families,” Weiland said.
Repealing the state sales tax had the governor’s support during this past legislative session, but in the end lawmakers did not oblige. Legislators instead passed House Bill 1137, which reduces the general state sales tax rate from 4.5% to 4.2% through the summer of 2027. Noem signed this bill, and it will go into effect in July. It’s estimated to save taxpayers slightly more than $100 million in its first year.
“I think the effort to repeal the sales tax on food through the ballot is irresponsible and imprudent,” said Republican Will Mortenson, who served as House majority leader during the session.
Mortenson says lawmakers took a hard look at the question of how to cut taxes.
“We wound up cutting the general sales tax cut, and we did that because it provides sales tax relief not just on food, but on fencing supplies and fireworks and everything that we pay taxes on,” Mortenson said.
Mortenson says a proposal of a tax cut without a way to finance it is “irresponsible.” According to a January estimate, repealing the state sales tax on groceries all together would save taxpayers just under $124 million in the first year.
“When the legislature for whatever reason can’t coalesce around something like this and get it done, we have this option to take it to the voters, and that’s what we’re going to do,” Weiland said.
According to the South Dakota Secretary of State’s office, the initiated amendment to repeal the state sales tax on groceries needs 35,017 signatures to make it to the November 2024 ballot. The initiated measure to do the same, however, needs only 17,509 signatures. The deadline for both efforts is May 2024.