January 13, 2015

South Dakota

State & Local Taxes in 2015


South Dakota Tax Code Features

Progressive Features

• No significant progressive features

Regressive Features

• No personal income tax

• No corporate income tax

• State sales tax base includes groceries

• Local sales tax bases include groceries

• Fails to provide tax credits to non-elderly taxpayers to offset sales, excise, and property taxes

Tax Changes Enacted in 2013 & 2014

• Eliminated refund for low-income taxpayers to offset impact of sales tax on food

ITEP Tax Inequality Index

According to ITEP’s Tax Inequality Index, South Dakota has the 4th most unfair state and local tax system in the country. States with regressive tax structures have negative tax inequality indexes, meaning that incomes are less equal in those states after state and local taxes than before (See Ap­pendix B for state-by-state rankings and more details).

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