House ratifies cigarette tax to fund programs


Tara Bordewyk, Community News Service

PIERRE (CNS) – If a bill that passed the House of Representatives Feb. 22 becomes law, South Dakota will join its neighboring states by raising the tax on cigarettes.

Minnesota, Iowa, North Dakota and Nebraska all have recently raised tobacco taxes, State Rep. Don Van Etten, R-Rapid City, said.

House Bill 1147 would increase the tax on a pack of cigarettes in South Dakota to 67 cents, and other tobacco products would have a 30 percent wholesale tax attached, which is a 20 percent increase.

The bill would support the governor’s plan to increase cigarette and alcohol sales in order to create revenues, protect reserves and fund programs for the state. The money generated from the tax will go into the state’s general fund. The Legislature has tabled both proposals to increase the tax on alcohol.

“If the Legislature is going to pass this bill it should be dedicated to education,” State Rep. Julie Bartling, D-Burke, said. Bartling introduced an amendment to do that, but it failed.

State Rep. Bill Peterson, R-Sioux Falls, said the bipartisan split of support on this tax issue should be overlooked so Democrats and Republicans can come together to pass the governor’s bill.

Peterson echoed statements Gov. Mike Rounds made in his State of the State address that asked the Legislature to work together to “chart a course for the future of South Dakota.” In his budget address the governor originally proposed raising $14.8 million from tobacco tax increases.

Two similar bills to increase the tobacco tax have been considered by the Legislature. The Senate passed a bill Feb. 14 that would raise the cigarette tax from 33 cents per pack to 53 cents per pack, but Senate Bill 61 would not increase the tax on other tobacco products.

It now moves to the House for consideration. The House of Representatives voted 69-0 to table House Bill 1271, which would increase the tax to 63 cents per pack and increase the tax on other tobacco products to 20-percent of the wholesale price.

House Bill 1147 passed 49-20 and now moves to the Senate for consideration.