Some state lawmakers are proposing legislation to bring property tax relief next legislative session.
That comes as Gov. Kristi Noem is calling on the Republican controlled legislature to make a temporary sales tax cut permanent.
In 2023, state lawmakers passed an overall sales tax cut of .3 percent—meaning for every $100 you spend you save .30 cents.
Fearing a slowdown in the economy, some wanted to add a sunset to the cut. That tax is set to increase from 4.2 percent back to 4.5 percent in June 2027.
During the annual budget address on Tuesday, Gov. Krisi Noem said low taxes keep the state’s economy strong.
“Last year during this speech, I asked you to make a permanent tax cut for the people of South Dakota – and I am reiterating that request today," Noem said. "Our people deserve better than a temporary sales tax holiday.”
However, some lawmakers say property tax relief is a pressing issue.
Representative Tony Venhuizen, R-Sioux Falls, is proposing a bill to increase the state’s overall sales tax to 5 percent—with the money generated by the .8 percent increase going toward property tax relief.
“That generates $280 million. We would put all of that into property tax relief," Venhuizen, who is Gov. Noem's former chief of staff, said. "That should be an average of 35 percent property tax relief for homeowners in South Dakota.”
Incoming Senate President Pro-Tempore Chris Karr, R-Sioux Falls, was the key architect of the overall sales tax cut in 2023. He said property tax relief is needed.
Karr wants a legislative work group to look at property tax relief proposals next session.
“You got to start with some ideas," Karr said. "You have a seed planted today, that we can work on, a big topic like that. It’s going to take both chambers. It’s going to take the executive branch.”
The 100th annual legislative session starts on January 14.
