All three House bills that cut certain taxes are now in play.
Legislative leaders and the governor say they want to cut some form of taxes at the state level.
They all cut somewhere around $100 million dollars, but which tax cut the legislature approves remains to be seen.
The appetite for a tax cut exists on all sides: House and Senate, Democrat and Republican.
All three bills are still before a House committee that helps set the state budget.
The first is a Gov. Kristi Noem backed proposal to remove the state sales tax on food. Another is to reduce the entire state sales tax rate from four and a half to just four percent. Another is to exempt the first $100,000 of valuation on owner occupied-dwellings.
Rep. Will Mortenson is the Majority Leader in the House. He said Republicans there are very conservative, which means two things. There’s a keen interest in cutting taxes, and that those cuts are sustainable.
“They’re saying we’re in good times now. We know the good times don’t last forever,” Mortenson said. “They are mindful that whatever we do needs to be something that is sustainable. Not only during the good times—but if times get worse as well.”
A House panel advanced the property tax cut bill Thursday morning. Republican Sen. Casey Crabtree said he’s hearing most support for that tax cut idea.
“The only people who get a tax cut underneath that are South Dakotans. Nobody else does,” Crabtree said. “So, a lot of our members on the Republican side, really like that.”
Backers of the property tax proposal estimate it will take $70 to $80 million in general funds to replace those property taxes. Because property taxes go to education, the state will have to backfill that amount.
Some Democrats are uncomfortable with that idea and agree with the governor on cutting the 4.5 percent tax on food tax.
“We also have a tax cut out there for either one cent or two cents. We’d be happy to work across the aisle to compromise," said Democratic Sen. Reynold Nesiba. "I think it’s essential to do something this year on reducing the sales tax on food.”
Lawmakers expect the debate on what tax to cut will last through the entirety of regularly scheduled legislative session, which runs through mid-March.
