South Dakota

South Dakota has no personal or corporate income tax, with the exception of a 6% tax levied on financial institutions. Personal property taxes have been reduced since 1978, continuing into 2000 with a 30% property tax reduction. A state sales and use tax of 4% supplies more than two-thirds of South Dakota's general-fund receipts. Taxes are also levied on gasoline sales, alcoholic beverages, tobacco products, mineral severance, inheritances, insurance premiums, and other items. A large proportion of total state and local revenues are collected by local government (43.2% in 2000).

The state collected $977 million in taxes in 2002, of which 52.7% came from the general sales tax, 24.8% from selective sales taxes, 14.3% from license fees, 4.4% from corporate income taxes. 3.6% from severance taxes, and 0.2% from death and gift taxes. In 2003, South Dakota ranked 42nd among the states in terms of combined state and local tax burden, which amounted to about 7.7% of income.

The following table from the US Census Bureau provides a summary of taxes collected by the state in 2002.