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Noem still mulling sales tax cut approved by legislature

Kristi Noem Mitchell bill signing.jpg
Evan Walton
Gov. Kristi Noem attends a bill-signing ceremony in Mitchell on March 15, 2023. After the ceremony, she expressed concerns over a tax cut proposal approved by the legislature.

Gov. Kristi Noem indicated she still hasn’t made up her mind about signing a tax cut bill approved by the legislature.

Lawmakers passed a bill cutting the overall sales tax by 0.3 percent.

Noem favored a cut removing sales tax on food. She campaigned heavily on the proposal during her 2022 reelection campaign.

The governor spoke with reporters about her continued concerns over the legislature's tax cut plan at a separate bill-signing ceremony Wednesday in Mitchell. She said her office is still "evaluating" its options, adding that "it's really hard to put my signature" on a bill that doesn't provide proper tax relief.

Noem also said lawmakers complicated matters by approving extra spending not included in her budget.

"You know, when you look at the decisions that need to be made between now and veto day on bills, I’d say the vast majority of my budget was funded. The problem was the legislature spent $80 million above and beyond my budget," Noem said.

The governor said that spending shows a lack of commitment to taxpayers.

She also criticized the legislature for including a sunset on their cut. Their proposal ends after four years.

“It’s a temporary tax holiday," Noem said. "Anyone that calls that a cut is lying.”

Noem has about a week to decide whether she’ll veto the tax cut bill.

While lawmakers tussled over various tax cut proposals throughout the legislative session, both chambers ultimately approved the the final proposal with well over the two-thirds majority needed to override a veto.

Veto day is March 27.

Josh Chilson is the news director at South Dakota Public Broadcasting. A Florence, S.D. native, Josh graduated with a journalism degree from South Dakota State University. He has worked as as a newspaper reporter and videographer, and most recently as managing editor for Dakota News Now. Josh is based out of SDPB's Sioux Falls studio.