Governor Dennis Daugaard says increasing the sales tax on food does not pose an economic problem for South Dakotans. The governor’s plan to fund education increases the sales tax on all purchases one half of one penny.
Daugaard says the state has one of the lowest sales taxes in the nation; he says taxing necessities provides stable state revenues.
"It’s not as if we are adding to an unfair burden already. I think the burden is quite low today, and I think it sounds appealing to say ‘remove the sales tax on food,’ but the fact of the matter is most people who pay sales tax on food are perfectly capable of paying it – perfectly capable," Daugaard says. "And to say that someone like me shouldn’t pay sales tax on food is not using a surgery knife; they’re using a blunt instrument to attack the problem of the very low income having to pay sales tax on food."
Daugaard references a plan from Democratic lawmakers that ups the sales tax by one cent but removes the tax from food purchases. Democrats say taxing food makes the working poor spend a greater percentage of their paychecks on food.
Daugaard says people he calls "very low income" are eligible for food stamps, so a sales tax increase does not add to their financial challenges.