A recent report presented to South Dakota lawmakers by the Legislative Research Council highlights the state’s unique taxation dynamics within the region.
While South Dakota residents enjoy the lowest overall per capita tax burden among neighboring states, they also face the highest sales tax load.
In 2020, South Dakota’s total per capita tax burden was just over $4,400, closely trailing Montana, while North Dakota topped the list at just over $7,500.
Notably, South Dakota’s reliance on sales tax revenue, constituting 40% of the total tax revenue, sets it apart.
The state’s sales tax also includes food, which is a distinct feature within the region.
The report also looked into other tax categories and emphasized the importance of contextual analysis in assessing a state’s tax landscape.