Food Tax Back—Senate Barely Revives Noem Proposal Alongside Two Sales Tax Reductions and Property Tax Break

Hang on—Kristi Noem may get to make us eat our words about her food-tax fecklessness yet!

In another example of how no bill ever totally dies, the Senate yesterday grabbed a carcass bill, House Bill 1094, and stuffed it with a repeal of the sales tax on food. (Technically, we wouldn’t repeal the food tax; we’d just set the rate to 0%.) Senator Herman Otten (R-6/Tea) moved that hoghouse amendment to restore the food-tax repeal as the “third horse” in the race between competing tax-relief proposals. The Senate allowed Otten’s horse to rejoin the race on an 18–17 vote. A majority of Republicans followed Senate boss Lee Schoenbeck (R-5/Lake Kampeska) and objected to reviving the food-tax repeal, but all four Democratic Senators supported Otten and passed HB 1094 as amended.

Just before Otten resaddled the food-tax horse, the Senate bobbed the tail of Horse House Bill 1137, the proposal to cut the state sales tax rate in general. HB 1137’s prime sponsor, Representative Chris Karr (R-11/Sioux Falls), originally wanted to cut the state sales tax rate from 4.5% to 4.0%. The House reduced the cut rate to 4.2%. Yesterday, the Senate voted 33–2 to reduce the reduction further to 4.3%.

Determined to fight for their fraction, Representative Will Mortenson (R-24/Pierre) grabbed a carcass bill from the Senate, Senate Bill 104, and hoghoused it to put its 4.2% sales tax rate back in the race. The House approved that hoghouse 68–1.

Also on the racetrack is the Senate’s preferred nag, House Bill 1141, which Senate State Affairs hoghoused into a $425 property tax credit for homeowners. The House yesterday refused to concur with that amendment.

We thus have four horses—and where else in America will you ever see hoghouses produce horses?—racing toward conference committees to claim South Dakota’s federally subsidized surplus revenue:

1. HB 1094: the food-tax repeal Governor Noem and Senator Otten have borrowed from Democrats.
2. HB 1141: the Schoenbeck Senate’s preferred $425 property tax credit for single-family dwellings.
3. HB 1137: the Senate’s compromised compromise to cut the state sales tax on everything from 4.5% to 4.3%.
4. SB 104: the House’s compromise to cut state sales tax on everything to 4.2%.

Governor Noem got so excited about the Senate’s slim revival of the food tax that she actually took questions from South Dakota reporters in her office yesterday afternoon for the first time this Session. The laziest Governor on the Great Plains comically claimed that legislators “just don’t want to do the hard work of really cutting taxes.” Horsehockey—in one day, legislators resuscitated two tax-cut bills and thus put four tax cuts in play for conference committee. Four tax-cut proposals—that’s four times as many as Governor Noem put forward before jetting off to Washington to pander to her national audience during Session.

There’s no time for horsing around: the Legislature has just three days to conference these bills and decide which tax cut, if any, it will send to the Governor’s desk.