COUNTERPOINT: Food tax cut not the relief South Dakotans need
Guest column by Rep. Chris Karr
This year we are exploring three different proposals for providing tax relief to South Dakota taxpayers. I have brought House Bill 1137 to reduce the overall sales tax rate from 4.5 to 4.0 percent. There are eight reasons I believe this is the best tax cut for South Dakota.
IT’S THE LAW.
This tax cut addresses the current statute in state law, known as the Partridge Amendment. In 2016, the half-penny sales tax increase was passed by the Legislature and went into statute. At that time, an amendment was added to this legislation that would reduce that half-penny sales tax upon certain criteria being met. This amendment — the Partridge Amendment — said that if we start collecting online sales tax from businesses that do not have a physical presence in South Dakota (known as “remote sellers”), we will reduce the sales tax by .1 percent once we collected $20 million from those remote sellers. At the time, $100 million in remote seller tax receipts is what it would have taken to reduce the tax rate back down to 4.0 percent. This amendment is in statute. The amendment was brought to get the final votes needed to increase the sales tax in 2016 from 4.0 to 4.5 percent.