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South Dakota legislators call for November special session to repeal state food tax

Rep. Phil Jensen called for a special session to be held in Pierre on Nov. 3, just five days ahead of Election Day.

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PIERRE, S.D. — Seven South Dakota lawmakers and one lawmaker-elect on Tuesday, Oct. 11, issued a call for legislators to reconvene in an effort to repeal the state’s grocery sales tax just days before the election.

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Rep. Phil Jensen, R-Rapid City

Rep. Phil Jensen, R-Rapid City, announced Tuesday his call for the South Dakota State Legislature to gather again on Nov. 3 to reconsider a repeal of the state sales tax on food. He told Forum News Service he plans to introduce essentially the same bill that was introduced to lawmakers earlier this year.

According to the South Dakota Legislative Research Council, Senate Bill 177 was originally introduced as an act to repeal the requirement for an annual report by the Board of Regents on intellectual diversity and the free exchange of ideas. After passing the Senate as-is, it was substantially amended, or “hoghoused,” in the House of Representatives to eventually push for a repeal of state sales taxes on food.

After the House passed the latest version, the Senate elected by a vote of 22-9 to not concur with the amendments, killing the bill on March 8.

Now, more than seven months later, Jensen, who voted in favor of the tax repeal in the House, said it’s time for legislators to take a second look.

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“As we moved through the spring and into the summer, we saw a continuous rise in inflation, gas prices, and food prices,” Jensen said in a news release. “Consequently, a large number of people who are on fixed incomes and low earned wages, continued to get squeezed into unfortunate financial situations.”

In a phone call, Jensen doubled down on the financial impact to South Dakotans.

“Now's the time to pull the trigger on this, given that people are really hurting financially. Gas and food prices are skyrocketing and there’s an indication that we’re heading toward a recession,” Jensen said. “This is something that needs to be done because people are hurting.”

According to the U.S. Congress Joint Economic Committee’s State Inflation Tracker, monthly household expenditures in South Dakota have increased by roughly $740 between January 2021 and August 2022.

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Friday's gubernatorial debate featured, from left to right, Libertarian candidate Tracey Quint, Democratic candidate Jamie Smith and Republican candidate Kristi Noem.
KOTA/Dakota News Now

Call for special session follows Noem’s interest in tax repeal

Jensen’s call for a special session closely follows Gov. Kristi Noem’s recent commitment to repeal the state’s tax on food items, a promise she made Sept. 28 while touring Dakota Butcher in Rapid City.

“Today, we’re talking about cutting taxes in the state of South Dakota, and saving families. Saving their budgets, their grocery bills and also their pocketbooks,” Noem told the assembled crowd. “Today, I am proposing that we will follow through and deliver the largest tax cut in the history of the state of South Dakota. Today, I am promising that we will repeal the grocery food tax on all grocery items in the state of South Dakota so we can bring relief to our families.”

The tax cut promise indicates a shift for Noem, who has said in the past that repealing the grocery tax would complicate raising teacher and state worker salaries and accused state lawmakers of not debating the isssue thoroughly when discussing similar bills. She justified her shift in position by noting the state’s low unemployment rate, the growth of resident income over the last three years and a $115.5 million budget surplus.

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The governor has the authority to call a special session — something she has yet to do. In the alternative, two-thirds of each chamber of the state’s bicameral Legislature may also call a reconvention. Jensen said he’s unsure if there’s enough support for a special session, but said the timing is important.

“You just really never know on this,” Jensen said, “but I think the timing is really good right now.”

Others disagree. Alex Matson, communications director for Democratic gubernatorial challenger Jamie Smith, said he isn’t certain if Smith will be supportive of holding a special session just five days ahead of Election Day Nov. 8.

“Before Jamie wants to decide where he stands on the special session itself, he wants to kind of find out the details of what that looks like,” Matson said. “If you're calling for a special session five days before an election, what does that look like for a final push for campaigning?”

He assured, however, that Smith is in favor of the policy, while claiming Noem’s campaign is only in favor of the move for political convenience.

“Jamie has always been for repealing the grocery tax. He’s been pushing for this for the last four years. It had bipartisan support but Gov. Noem killed the last bill,” Matson said. “Kristi Noem has had four years to pass this legislation which had bipartisan support, and she chose not to, but now she's doing it for political convenience.”

Jensen said his call for a special session is supported by Republican Sen. Julie Frye-Mueller, Reps. Taffy Howard, Tony Randolph, Kevin Jensen, Steve Haugaard and Aarson Aylward and Senator-elect Tom Pischke.

If lawmakers were to reconvene to take up the issue, it would come at a cost of roughly $47,000 per day to taxpayers.

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A South Dakota native, Hunter joined Forum Communications Company as a reporter for the Mitchell (S.D.) Republic in June 2021 and now works as a digital reporter for Forum News Service, focusing on regional news that impacts the Dakotas, Minnesota and Wisconsin.
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