Governor Larry Rhoden defended his tax policy approach Thursday while dismissing a proposed referendum on Senate Bill 245, asserting that he and then-Governor Kristi Noem had advocated in 2023 for removing South Dakota's sales tax on groceries. The legislature, however, rejected that proposal and passed a temporary sales tax cut instead.
A review of legislative records reveals a more complicated picture. As a state senator in 2009, Rhoden voted against exempting food from sales tax. During his tenure as lieutenant governor under Noem, he remained silent on two separate grocery tax repeal measures introduced in the 2024 legislature. When Rhoden assumed the governorship, he did not support a 2025 bill to exempt in-state food production from sales tax.
This year, Rhoden's administration took a more direct stance: his Bureau of Finance and Management testified against House Bill 1281, which would have eliminated the food tax while raising the general sales tax to 5 percent on other goods. Notably, both of Rhoden's major property tax relief bills this session—Senate Bills 96 and 245—rely on increasing sales taxes across all categories of goods, including groceries.
Rhoden's current claims echo former Governor Noem's shifting positions on the issue. Noem proposed repealing the grocery tax during her 2022 campaign, months after opposing such a measure during the 2022 legislative session. She later abandoned the proposal, opposing a citizen initiative aimed at achieving the same goal. During her tenure, Noem did not expend political capital to advance grocery tax repeal bills in the 2024 legislature.
The contrasting record between Rhoden's public statements and his legislative actions underscores tensions within the state's ongoing property tax reform debate, particularly regarding how to structure tax changes affecting food purchases.
