SIOUX FALLS, S.D. (KELO AM) - The South Dakota Bureau of Finance and Management told legislators yesterday that their forecast calls for the slump in farm income to end.
Numbers are beginning to materialize for South Dakota appropriators to fashion the state budget, traditionally done at the end of the 40 day session.
Jim Terwilliger with the BFM says he doesn't expect farm income to improve greatly but it shouldn't decline to the degree that it did in the last couple years.
Terwilliger says the agency also predicts a rise of over 10% in this year's sales taxes. He attributes the increase to last year's half cent increase in the sales tax.
He says the state's taxable sales are lower than last year. Without the increase the sales tax revenue would be down a couple percent.
Terwilliger says for FY '18 he's "a little less than a billion. My growth rate is 5%. On my base I'm about 4.9%. I've included some adjustments from some of those online remote sellers that are going to add to our tax base here in FY 2018."
He says South Dakota has experienced several low growth years in sales taxes. He says FY '15 was pretty weak at 1.6%, FY '16 was fairly weak at 2.9% and for 2017 "we're actually adjusted for the rate, we're actually lower. I do anticipate things to improve a little bit in 2018."
Terwilliger says BFM predicts an increase of 5% in next year's sales tax revenue.
The revised budget is about 1% lower than Governor Daugaard's proposal in December.
