Press "Enter" to skip to content

Surplus Again: South Dakota Overtaxes, Underdelivers; Sales Tax Revenues Flagging

For the fourth year in a row, Kristi Noem has taxed South Dakotans too much:

Today, Governor Kristi Noem announced that South Dakota closed the 2023 budget year with a surplus of $96.8 million.

“South Dakota’s economy is continuing to thrive because we keep state government small, taxes are low, and we spend within our means. This surplus shows that what we are doing here is working,” said Governor Noem. “As long as we continue to budget responsibly, families across the state will be able to keep more of their money in their pockets, and we will be able to avoid unnecessary debt by using this surplus for future prison construction costs.”

…By law, the fiscal year 2023 surplus was transferred to the state’s budget reserves. The state’s reserves now total $335.7 million or 14.7% of the fiscal year 2024 general fund budget. [Office of the Governor, press release, 2023.07.17].

Budgeting responsibly? Wouldn’t budgeting responsibly have left that $96.8 million in families’ pockets instead of stuffing it into the state’s swelling shoebox? A surplus doesn’t show that what we’re doing is working; it shows that we’re taking too much in taxes, not spending it on the items we budgeted for and missing opportunities to invest in other priorities or provide tax relief. Once again, we’ve incurred a surplus that could go a long way toward eliminating South Dakota’s unusual sales tax on food, something Governor Noem said she wanted to do but then didn’t really work all that hard for, let fail during Session, and now opposes again.

Speaking of sales tax, we didn’t get as much as we thought we would:

State government spent $79.7 million less than appropriated in fiscal year 2023, with the total revenue finishing above the legislative adopted forecast by $17.1 million. Sales and use tax, which is the state’s largest revenue source, finished 0.5% below estimates, down $6.9 million [Governor, 2023.07.17].

We still took in more sales tax than last year, just not as much as the Legislature figured we would when it adjusted the budget in February. So the surplus is less a result of economic “thriving” and more a result of the state not filling jobs, ordering staplers, or finding other good practical uses for the money it took from taxpayers.

9 Comments

  1. P. Aitch 2023-07-18 07:48

    Colorado is expected to return $2.7 billion to taxpayers. (Love that $600.00 or so check every year.) Don’t you? Oh. You don’t get your overtaxed money back? It sits in the bank until “The Elite” decide what they want to spend it on.
    That sucks, huh?

  2. Bonnie B Fairbank 2023-07-18 11:01

    Oh, just ESAD, Kristi. My property taxes are $3,000.00 a year. Just because this backwards, hidebound, and hillbilly fiefdom of yours doesn’t have state income tax doesn’t mean it has a thriving economy, and the tiresome refrain of “families across the state will be able to keep more of their money in their pockets” is so cliched. Fer chrissake, hire someone who can think and write – your announcements are painful and embarrassing to read.

  3. Mike Lee Zitterich 2023-07-18 17:41

    The State constitution specifically states that “WE” have to set aside funds for tomorrow, much of the surplus are these funds. She has to report to the legislature and to the people how much our surplus of funds are. Be thankful we are a Republican State cause if the far left was in charge, we would have no surplus for tomorrow.

  4. Lars Aanning 2023-07-18 20:54

    Sales tax on food is insane and unconscionable…

  5. P. Aitch 2023-07-18 21:35

    Boy’s a comedian, now? C’mon, man. Really?
    “Be thankful we are a Republican State cause if the far left was in charge, we would have no surplus for tomorrow.”
    South Dakota can operate for 41.7 days on its rainy day fund.
    Colorado can operate for 86.8 days on its rainy day fund.
    California 91.5. – New Mexico 101 days.
    Try again, Mike Zitterich.

  6. Cory Allen Heidelberger Post author | 2023-07-19 06:08

    Mike, I am unaware of any provision in the South Dakota Constitution that requires the state to maintain any budget reserve. Please enlighten us by pointing to the specific Article and Section that supports your claim.

    Note that if Mike does find a specific budget-reserve clause in the Constitution, he will refute his second claim that a Democratic government would make the reserve disappear; a Democratic government would be as beholden to a Constitutional requirement as the current Republican government.

  7. Cory Allen Heidelberger Post author | 2023-07-19 06:08

    Note also that MIke is cheering for dishonesty and bad budgeting: The state told us it would use our taxes for specific purposes in the budget; the state overtaxed us and did not provide the promised public goods and services.

Comments are closed.