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Senate, House, governor draw lines in tax cut battle

Melissa Hamersma Sievers

Lawmakers and the governor are making their tax cut priorities known as they enter the final week of session.

It’s unclear what tax, if any, will get cut.

Republican leaders in both chambers say tax cuts remain a priority.

House lawmakers are making it clear they want to see the overall sales tax rate reduced from 4.5 percent down to 4.2 percent. They’ve sent two identical bills to do just that over to the Senate.

“We have our druthers in the House," said House Majority Leader Will Mortenson. "We prefer the broad-based sales tax cut and at the amount we put forward.”

In the Senate, several members are concerned about long-term increased revenue projections. Senators are also concerned about petition language that could remove the state’s sales tax on food. So, they’ve placed a sunset on the overall reduction.

Senators are sending a bill to the House to provide $425 in property tax relief for owner-occupied dwellings. A similar idea was already rejected by the House.

Regardless, Senate Majority Leader Casey Crabtree said both chambers continue to seek significant relief for South Dakotans.

“Do we disagree slightly on what this tax cut relief should look life? Yeah,” Crabtree said. “I think that’s a good part of the process. We’ll work through that.”

Gov. Kristi Noem said she still wants the state sales tax on food eliminated. Noem is indicating she could veto the state budget if a food tax repeal is not included.

“I think it’s silly that they think that I feel like in two weeks I got to sign that budget if I don’t like it," Noem said Wednesday in Sioux Falls. "I have a constitutional requirement to approve whatever budget they present to me and I've got time to make sure that it’s right.”

There is one thing all those proposing a tax cut agree on, which is the amount. All shake out to just over $100 million.

Some Democrats say it's 'highly likely' lawmakers walk away from session without a tax cut.

"If we had to take a vote today [Thursday, March 2] I don't think there'd be a tax cut in South Dakota on anything," said House Minority Leader Oren Lesmeister.

Lawmakers have until March 9 to craft and pass a state budget.

Lee Strubinger is SDPB’s Rapid City-based news and political reporter. A former reporter for Fort Lupton Press (CO) and Colorado Public Radio, Lee holds a master’s in public affairs reporting from the University of Illinois-Springfield.
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