HB 1281 reduces sales and use tax rates on non-prepared food (like groceries) for consumers while increasing tax rates on other items, including certain excise taxes and use taxes. The bill establishes a new fund specifically for school district capital projects, such as building construction or major equipment purchases. It defines "food" to exclude prepared meals (e.g., restaurant takeout), alcohol, tobacco, and candy, ensuring the tax cut applies only to basic grocery items. The policy shifts tax burden from grocery shoppers to other taxable goods and services to finance school infrastructure.
This bill reduces property taxes for homeowners by lowering the mill levy rate on owner-occupied single-family homes from $5.21 to $20.51 per $1,000 of taxable value (with the exact figure clarified in the bill text). It simultaneously raises the state sales tax from 4.2% to 4.7% for 2026-2027 and to 5% after 2027, and expands the gross receipts tax to cover more services like dry cleaning, beauty shops, and rentals. The revenue from these tax increases is explicitly allocated to replace lost school district property tax revenue and fund pay raises for state and school employees. The bill ensures school districts maintain their total funding levels under the new system.
HB 1321 requires county treasurers to calculate excise tax on used vehicles sold by private individuals (not licensed dealers) using the amount listed on the bill of sale, rather than the vehicle's retail value from a dealer guide. It directly affects private sellers and buyers of used vehicles, as well as county tax offices responsible for collecting the tax. The bill mandates that both parties submit a bill of sale to the treasurer; if missing, tax is assessed based on the dealer guide value. This change replaces the previous default method for private sales, ensuring tax is calculated from the actual transaction amount documented on the bill of sale.
This bill exempts sales tax on enterprise information technology equipment and computer software purchased for use in South Dakota's qualified data centers. It directly affects data center owners, operators, or tenants (referred to as "qualified businesses") who meet specific criteria, such as having facilities classified as real property subject to taxation and equipped with fire suppression systems. The key mechanism requires businesses to submit documentation to the Department of Revenue to verify eligibility and maintain annual certification. To retain the exemption, businesses must also ensure electric service agreements avoid shifting costs to other customers and confirm water usage compatibility with local providers. The tax exemption applies to equipment like servers, cooling systems, power infrastructure, and security systems used exclusively in these facilities.
HB 1254 exempts soil amendments sold in single purchases of 500 pounds or more from South Dakota's sales tax, but only when used exclusively for farming. This directly affects farmers or agricultural businesses buying these products in qualifying bulk amounts. The bill adds a specific tax exemption to state law, removing sales tax from qualifying soil amendments defined under existing law. It does not change tax rates for other products or apply to smaller purchases or non-agricultural uses.
HB 1283 exempts nonresident active-duty military personnel and their dependents stationed in South Dakota from paying state motor vehicle license fees on one noncommercial vehicle (car, truck, or van). To qualify, applicants must submit military orders showing their nonresident status and active duty stationing in South Dakota along with their vehicle registration. The exemption covers license fees only and must be renewed annually, but it does not apply to specialty license plates or the excise tax paid when purchasing a vehicle. This policy directly affects military members and families temporarily stationed in South Dakota while maintaining their primary residence elsewhere.
SJR 507 proposes a constitutional amendment for voter approval that would reduce property taxes for owner-occupied homes while increasing business tax rates. Specifically, it would lower the maximum school district tax rate for single-family owner-occupied homes from $20.50 to $5.21 per $1,000 of taxable value, and raise the gross receipts tax rate for retailers and service businesses from 4.2% to 5%. This tax swap would directly affect homeowners through lower property taxes and businesses through higher sales tax rates on goods and services. The amendment requires voter approval at the next general election before taking effect.
SB 243 imposes a new transaction tax on retail purchases: $1.50 for items $15 or more, and 10% for items under $15. Revenues from this tax fund a "property tax replacement fund" to reduce property tax levies for specific property types. The fund prioritizes eliminating taxes on owner-occupied homes first, then agricultural property, and finally nonagricultural property - reducing each category equally until funds run out. Property owners in South Dakota would see lower tax bills for these categories, while retailers must collect and remit the tax, with penalties for non-payment (misdemeanor for late payment, felony for false returns).
This bill amends South Dakota tax law to establish two specific methods for determining the purchase price of a used vehicle acquired by gift or other transfer with no or minimal payment. It directly affects individuals receiving vehicles this way, as it provides an alternative to the default tax assessment method. The key change allows taxpayers to use either the retail value from a nationally recognized dealers' guide (approved by the Secretary of Revenue) or a documented bill of sale showing the actual prior purchase price. This gives people a clearer path to prove the vehicle's value for excise tax purposes, potentially reducing their tax burden compared to the previous default of using the retail guide value.
HB 1233 modifies South Dakota's tax collection agreements with Indian tribes by expanding the list of state taxes tribes can collect on behalf of the state. The bill adds 13 specific taxes to the existing list, including retail sales tax, cigarette tax, motor vehicle excise tax, and remote seller sales tax. Under the agreement, tribes would collect these taxes and the state would retain a set percentage of the collected revenue as an administrative fee. This directly affects tribal governments (as tax collectors) and South Dakota's Department of Revenue (as the state entity managing collections).
