A good chunk of South Dakota’s $115.5-million budget surplus for Fiscal Year 2022 came from collecting $36.6 million more in sales tax than expected.
But according to the Legislative Research Council, that growth didn’t come from South Dakotans buying more stuff. In a presentation to the Joint Appropriations Committee on Wednesday, the LRC noted that consumer spending in South Dakota actually shrank by 1.8% in FY2022. The state hauled in 12% more sales tax from July 2021 through June 2022 only because of inflation and federal stimulus:
The LRC anticipates that South Dakotans will buy even less stuff in Fiscal Year 2023, and the hoped-for 4% increase in sales tax revenue will again come entirely from higher prices and remaining federal stimulus:
None of us like higher prices, but right now, the State of South Dakota is capitalizing on those higher prices by taking more money out of your pocket right along with the profiteering corporations, as well as padding its budget with ongoing federal stimulus.
Governor Noem may complain a lot about inflation and federal spending, but she’s not about to do anything to stop them.