Ag Downturn Hits State Government

Lawmakers are experiencing the ripple effect of low commodity prices. With farm equipment sales down in South Dakota, sales tax collections are down, too.

Sales tax collections on farm equipment peaked in South Dakota’s 2014 budget year at an estimated $43.9 million. Collections fell to $33.6 million in 2015.

This year in the state, estimated tax due through March was about $22.6 million, down $4.3 million from the same period in the previous budget year.

State Economist Jim Terwilliger expects receipts for the current budget year to be down about 15 percent. He said it’s not surprising to see collections “come back down to earth” after the farm boom.

“When it was going crazy in 2013, you just couldn’t keep up. It was a madhouse. I think we sold too much stuff,” said Rod Paul, a sales manager at C & B Operations, an equipment dealer. “It’s just steady business now. It’s not slow or dead, it’s not overly wild either.”

Source: Associated Press S