Talking shop: Noem shares her thoughts on grocery tax repeal while bagging groceries in Sturgis

STURGIS, S.D. – After a tour of the Lynn’s Dakotamart Wednesday afternoon, Governor Kristi Noem and Lieutenant Governor Larry Rhoden spent some time ringing up customers and bagging groceries and talking to residents about the need to cut the grocery sales tax.

Why is repealing the grocery tax important for South Dakota residents?

In the State of South Dakota, the sales tax rate for groceries is currently 4.5 percent. Only 12 other states still charge sales tax on groceries, including Utah, Kansas and Idaho. “For so many people, they are surprised by what their grocery bills are, what inflation has done to drive up those food costs for their families,” Noem said. “And they are grateful our economy is strong and that we have the ability to cut taxes in a way that will allow them an opportunity to make their budgets go even further. They’re thankful to be in South Dakota. They’re grateful that we stayed open, that their incomes are going up and that our economy is strong. But they also recognize that the federal policies are going to hurt us in the future. Gas price are going up. Winter’s coming and utility bills are high. And then with food costs increasing as well, it’s going to be more difficult to take care of their families. That’s a big concern on people’s mind.”

What would a grocery tax repeal mean for average South Dakota families?

“The average South Dakota family will save hundreds of dollars a year,” explains Noem. “It can be anywhere from $500 to $800 per family of four. But that also depends a lot on how much grocery prices go up. Every time we see a price increase on eggs or milk or cereal, the sales tax cost goes up as well. If we continue to see what President Biden’s doing by driving up those inflation costs because of the policies that they’re pursuing, people will be more and more grateful that they don’t have to pay the state sales tax on it.”

How would South Dakota recover lost funding if the grocery tax is repealed?

“We grew our economy because we stayed open and told our story here in our state. Businesses grew. More businesses moved in and families’ incomes are going up. We’ve had a permanent economic growth in our state because of those policies and we’ve taken in historic revenues, and that’s why we can do this tax cut at this time.” Noem continues, “It’s basic economics, and it’s a wonderful thing to see. The last several years, since I’ve been governor, we’ve paid down debt. We put historic amounts into our reserves to be prepared for the future. We’ve built railroads and bridges [and] repaired our dams. We have a  triple-A credit rating. [We] have the best pension fund in the country. So being able to grow our economy like this has given us permanent stability that allows us to let people keep more money in their pockets.”

What has changed since the last time the grocery tax repeal was presented to the legislature?

“I supported this tax cut last session. I went and visited with the Senate leadership about it and that I would support it if they could get it to my desk. We spent days figuring out what the impact would be to the State and how to make it workable. The bill never did make it to my desk, so I didn’t get the chance to weigh in on it,” says Noem. “But now we’ve had even more economic growth since then, and we can do this with confidence at this time. Allowing our state to repeal the sales tax on groceries is incredibly important right now, and many, many other states already don’t tax groceries. In fact, 37 other states don’t tax groceries. It’s time that South Dakota make sure that people have more opportunities to keep these dollars for their families.”