South Dakota had more than twice as many people out of work in June as in March before coronavirus took over, and the pandemic recession is crushing various business sectors, yet socialist welfare checks for darn near everybody have kept our economy and state tax revenues afloat.
There have been some signs that coronavirus has been good for some small towns’ bottom lines, as folks in some areas make fewer shopping trips to big towns and spend their money locally instead. But there are stronger signs that more shopping is moving from local shops to online vendors.
According to the Fiscal Year 2020 state sales tax summary, online taxable sales grew from 18.18% of our total state taxable sales in FY2019 to 20.83% in FY2020. Online taxable sales grew 20.18%, while in-state sales grew only 1.49%.
| FY2019 | FY2020 | %chg | $diff | |
| out of state | $4,139,175,484.53 | $4,974,406,678.70 | 20.18% | $835,231,194.17 |
| SD total | $22,772,123,032.23 | $23,885,849,978.87 | 4.89% | $1,113,726,946.64 |
| in state | $18,632,947,547.70 | $18,911,443,300.17 | 1.49% | $278,495,752.4 |
Figures from June show online sales propping up our sales tax revenues even more. Last month, online taxable sales grew as a share of total state taxable sales from 17.67% in June 2019 to 21.56%. On that year over year measure, online taxable sales increased 23.88% while in-state sales decreased 3.28%.
| June 2019 | June 2020 | %chg | $diff | |
| out of state | $338,409,093.71 | $419,209,430.70 | 23.88% | $80,800,336.99 |
| SD total | $1,915,664,492.24 | $1,944,794,979.68 | 1.52% | $29,130,487.44 |
| in state | $1,577,255,398.53 | $1,525,585,548.98 | -3.28% | -$51,669,849.55 |
Congress is trying to negotiate a deal to send most of us another round of $1,200 coronavirus relief checks (plus $500 for our dependents—maybe all of them this time, not just the ones under 17). If we get them, our sales tax trends indicate South Dakotans will spend more of those checks on online vendors and less at their local stores.
If that pattern continues, we may be able to say by winning South Dakota v. Wayfair and our right to force Amazon to collect South Dakota taxes, Marty Jackley has done more to sustain South Dakota’s state revenues than Kristi Noem has. But we can definitely say that the combination of increased taxing authority and government relief checks show that South Dakota is weathering the coronavirus recession thanks to bigger government, not the anarcho-libertarian slogans Governor Noem keeps spouting to impress her patrons on the national scene.
Those online sales figures may not be entirely reflective of not shopping locally. For example, buying something from ACE Hardware online for curbside pickup at your local store. Benn there – done that.
Many other “local purchases” can be made online as well – including fast food, big box, groceries and so on.