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Bill

Bill

SB 96

authorize the imposition of a county option gross receipts tax to reduce owner-occupied property taxes.

2026 Regular Session

South Dakota bill allowing counties to tax business gross receipts to fund owner-occupied home property tax reductions.

Signed by the Governor on 2026-03-30
#counties #propertytax #retailsalesandservicetax #taxation
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Bill Summary · SB 96

Legislative bill overview

SB 96 would allow South Dakota counties to implement a local gross receipts tax (a tax on business revenue) as an alternative revenue source. The revenue generated would be specifically dedicated to reducing property taxes on owner-occupied homes. This represents a shift in how counties fund services by moving from property-based taxation toward business revenue taxation.

Why is this important

Property taxes are a significant burden for homeowners, and this bill offers counties a mechanism to reduce that burden without state-level intervention. However, the actual impact depends on whether gross receipts taxes generate sufficient revenue and how businesses respond to the new tax. Counties with different economic bases would likely see vastly different outcomes—rural counties with limited business activity might struggle to generate meaningful revenue.

Potential points of contention

  • Business tax burden: Gross receipts taxes are broad-based and can disproportionately affect lower-margin businesses, potentially harming small retailers and service providers compared to higher-margin industries
  • Economic competitiveness: Counties that adopt the tax may become less attractive to businesses compared to neighboring counties without it, potentially reducing job growth or causing businesses to relocate
  • Regressive nature: While helping homeowners, the tax could increase costs for consumers (passed through as higher prices), potentially affecting lower-income residents more severely than upper-income residents

Compiled from official sources — confirm details with the bill’s official record.

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