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Sales Tax Increase to Appear on South Dakota Ballot

1 min readBy: Scott Drenkard

Last Wednesday, the Secretary of State of South Dakota announced that a ballot proposal to raise the general sales taxA sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. A sales tax should exempt business-to-business transactions which, when taxed, cause tax pyramiding. of the state will appear on the general election ballot in November of 2012. The measure, which would raise the statewide sales taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. rate from 4 percent to 5 percent, would place all of the additional revenue garnished from the tax into the “South Dakota Moving Forward Fund,” which splits the revenue 50-50 between increased K-12 education and Medicare spending.

One recent poll found that 56 percent of South Dakotans oppose a sales tax increase, but another poll conducted by the Associated School Boards of South Dakota found almost the exact opposite: 55 percent of South Dakotans would support a sales tax increase.

Regardless, the issue appears to have some traction behind it, the petitioners submitted 28,673 valid signatures for the measure, almost double the minimum 15,855 needed.

Also, there are several local rate increases set to take effect on January 1, 2012 for five municipalities in South Dakota: Bruce, Camp Cook, Frankfort, Oldham, and Irene.

To compare South Dakota’s state and local sales taxes with other states, click here.

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