What the bill would have done
Thursday saw a South Dakota House committee vote down a bill proposing the elimination of grocery sales tax, the institution of a school construction loan program, and a rise in cigarette taxes.
Rep. Erik Muckey, a Democrat from District 15 in Sioux Falls, presented House Bill 1281, which he named the “Feed Families Fund Schools Act.”
Supporters: relief for family budgets
Supporters said eliminating the state tax on groceries would make food more affordable. Ellie Bailey, a lobbyist for the South Dakota Advocacy Network for Women, urged lawmakers to support the bill.
Opponents: net tax increase and budget constraints
The Bureau of Finance and Management opposed the measure. Derek Johnson, the state economist for BFM, told the committee it amounted to a significant overall tax increase and would reduce lawmakers’ flexibility by directing sales tax revenue into a dedicated fund.
Opponents also argued that because sales tax is not collected on SNAP and WIC purchases, the grocery tax cut would not benefit some of the lowest-income households, while the higher overall rate would apply more broadly. Matthew Bogue, South Dakota Farm Bureau’s public policy director, urged lawmakers to reject the bill.
Committee action and what’s next
The House Taxation Committee killed the bill by deferring it to the 41st legislative day.
Muckey said he has been in discussions with Rep. Tim Czmowski, R-District 6, about tax relief ideas.
