Certainly! Here’s the merged and formatted content for the FAQ page, incorporating both the original FAQs and the Q&A from the Liberty Forum session:

Frequently Asked Questions: South Dakota’s Plan to End Property Taxes

We know you’ve got questions — and we’re here with answers. This is your go-to guide for understanding how we replace property taxes with the simple, fair, and effective Gross Receipts Tax (GRT).

Upcoming Action: Liberty Forum April 19th, 2025!

📅 April 19th @ 2:00 PM — Rapid City First Assembly
Join the movement. Get the facts. Help us end property taxes for good.

Q&A: Audience Questions on the GRT Plan

We’ve been getting great questions from South Dakotans like you at the Liberty Forum! Here’s a clear breakdown of how the SEAL SD Liberty GRT plan works, addressing your concerns about taxes, funding, and savings. The GRT at 2.5% replaces $1.6 billion in property taxes, saving you $3,000–$5,000 yearly in Rapid City, and raises $1.8 billion to fund all services—let’s dive in!

Are groceries exempt from the GRT, but not convenience store items?

Yes, groceries are exempt from our GRT plan to protect your essentials! Basic groceries—like bread, milk, eggs, fruits, and vegetables—are not subject to the 2.5% GRT, keeping your family budget safe. But convenience store items—like hot food, soft drinks, or non-food “stuff” such as toiletries, cigarettes—are taxable, as they’re not staples. This mirrors South Dakota’s current sales tax rules, where groceries are exempt but prepared foods and non-food items aren’t.

Are medical items like prescriptions and devices exempt from the GRT?

Absolutely, essential medical items are exempt from the GRT to keep healthcare affordable! Prescription drugs, durable medical equipment, and prosthetics are not subject to the 2.5% GRT if prescribed by a licensed professional, mirroring South Dakota’s current sales tax exemptions. Over-the-counter drugs, medical supplies without a prescription, and elective services may be taxable, ensuring only necessities are protected.

Some items have both sales tax and GRT applied, correct? But I’m still saving money on my property tax bill, right?

No double taxation here—the GRT replaces sales tax on taxable items, so you’re not paying both! Under the GRT plan, the 2.5% rate applies to items like dog food, just like the current 4.5% state sales tax plus local rates—6.5% in Rapid City. With the GRT, taxable items drop to just 2.5%. For example, on a $20 pack of dog food, you’d pay $1.30 in sales tax now, but only $0.50 with GRT—a 62% tax cut on that purchase! Meanwhile, the GRT eliminates $1.6 billion in property taxes, saving you $3,000–$5,000 yearly in Rapid City.

Swapping the sales tax for a 2.5% GRT means the state takes a revenue hit—how do you replace that, and won’t the state lose revenue by default?

The GRT plan doesn’t cause a revenue hit—it’s designed to fully fund everything while saving you money. The GRT at 2.5% replaces the 4.5% state sales tax on taxable items, dropping your tax rate—$1.30 to $0.50 on a $20 item. The GRT also replaces $1.6 billion in property taxes, raising $1.8 billion total from a broader base, including $1.25 billion from retail and tourism, plus agriculture and services. Current sales tax generates about $1.2 billion annually, but the GRT’s wider scope makes up for the lower rate, ensuring no revenue loss. Rapid City gets $116.1 million, funding $84 million for schools, $22.4 million for police and fire, with a $1 million surplus.

Does the GRT add Rapid City’s local tax on top, creating double taxation?

The GRT at 2.5% doesn’t add Rapid City’s local tax on top—it replaces both the state and local sales tax for taxable items, so there’s no double taxation. Right now, Rapid City’s sales tax is 6.5%—4.5% state plus 2% local. With the GRT, taxable items are taxed at just 2.5%, not 6.5% plus 2.5%. On a $20 item, you pay $1.30 in sales tax now, but with GRT, it’s only $0.50—a 62% tax cut. The GRT also eliminates $1.6 billion in property taxes, saving you $3,000–$5,000 yearly in Rapid City.

Rapid City is losing tax revenue so other areas get no property tax? I live in an apartment, so I don’t pay property tax—how does this help me?

Rapid City isn’t losing revenue—it’s gaining more with the GRT plan, and you’ll benefit even as an apartment dweller! The GRT at 2.5% generates $116.1 million for Rapid City, covering $84 million for schools, $22.4 million for police and fire, and more, with a $1 million surplus—no cuts to your local services. State-wide, it raises $1.8 billion, replacing $1.6 billion in property taxes, so areas without property taxes aren’t taking from Rapid City—they’re funded by the same GRT base. As an apartment dweller, you don’t pay property tax directly, but it’s often baked into your rent—landlords raise rent to cover their $3,000–$5,000 tax bills. With GRT, that pressure drops, which can stabilize or lower your rent over time. Plus, the GRT cuts taxes on purchases like dog food from 6.5% to 2.5%—on a $20 item, you’d pay $0.50 instead of $1.30, saving you directly. You’ll also get up to $325 per voter in rebates from the $200 million surplus.

I own two apartment buildings in Rapid City, paying over $5,000 in property taxes that I pass on to renters—how does the GRT plan help us?

The GRT plan directly helps landlords like you by eliminating property taxes, which means big savings you can pass on to your renters. You’re paying over $5,000 in property taxes annually for your two buildings, and that cost gets baked into your renters’ rent. The GRT plan replaces $1.6 billion in property taxes state-wide with a 2.5% GRT, saving Rapid City landlords like you $3,000–$5,000 per property—potentially $10,000 or more for your two buildings. That’s money you keep, reducing the need to raise rent to cover taxes, which can stabilize or lower rent prices for your tenants over time. Renters also benefit directly—the GRT cuts taxes on purchases like dog food from 6.5% to 2.5%, saving them on everyday costs, and they can get up to $325 per voter from the $200 million rebate pool. Rapid City gains $116.1 million from GRT, funding $84 million for schools and $22.4 million for police and fire, so services stay strong.

Susan reminds Bill he now pays less for items state-wide than before. How are daycare services handled under this plan, and does it matter that private schools don’t get state funding?

Susan’s right, Bill—as an apartment dweller, you’re now paying less for items state-wide with the GRT plan. Before, South Dakota’s sales tax was 4.5% state-wide, plus up to 2% local—6.5% in Rapid City. On taxable items like dog food or cigarettes, you paid $1.30 on a $20 purchase. With the GRT at 2.5%, that drops to $0.50—a 62% tax cut on those items state-wide. You also get up to $325 in rebates from the $200 million surplus, saving you directly on everyday costs.

Daycare services are generally taxable at 2.5% under the GRT plan, just like they’re subject to sales tax now—South Dakota taxes services unless exempt, like healthcare or education for kids under 5 in certain programs. However, if your daycare qualifies as a small business under the $100,000 exemption threshold—39,150 businesses are exempt—neither you nor the daycare pays GRT, potentially lowering costs for parents. The GRT’s $1.8 billion revenue ensures services like daycare remain sustainable without raising fees.

Private schools not getting state funding doesn’t change their operations under the GRT plan. They rely on tuition and donations now, and the GRT doesn’t alter that—it funds public schools with $960 million state-wide, including $84 million for Rapid City’s public schools. Private school families benefit indirectly—parents save $3,000–$5,000 yearly in Rapid City on property taxes, or through lower rent if they’re apartment dwellers, plus rebates up to $325 per voter. That extra money can help cover tuition, making private school more affordable without state funding.

What about accounting services and legal services under this plan?

Under the GRT plan, accounting and legal services are generally taxable at the 2.5% rate, just like they’re subject to South Dakota’s current sales tax of 4.5% state-wide, plus local rates—6.5% in Rapid City. These services are considered taxable because they’re not exempt under state law, unlike essentials like groceries or prescriptions. However, if the accounting or legal firm qualifies as a small business under the $100,000 exemption threshold—39,150 businesses are exempt—they wouldn’t pay GRT, potentially lowering costs for clients. For larger firms, the GRT rate is lower than the current sales tax, so on a $1,000 legal bill, you’d pay $25 in GRT instead of $65—a 62% tax cut on that service. Meanwhile, the GRT eliminates $1.6 billion in property taxes, saving Rapid City property owners $3,000–$5,000 yearly, which benefits renters through stabilized rent. The $1.8 billion GRT revenue ensures services are fully funded, with $116.1 million for Rapid City alone, including $84 million for schools.

What does the average landlord pay in property taxes for a large apartment building in Rapid City, and how do they benefit under the GRT plan?

A large apartment building in Rapid City, say 20–30 units with an assessed value of $1.25 million to $2 million, typically pays $25,000–$50,000 in property taxes annually, based on a 2%–2.5% mill levy rate. The GRT plan eliminates those taxes entirely, saving you $25,000–$50,000 per building—$1.6 billion state-wide. That’s money you can keep, reducing the need to raise rent, which helps your tenants affordably stay. Plus, the GRT lowers taxes on services you use, like accounting, from 6.5% to 2.5%—on a $1,000 bill, you’d pay $25 instead of $65. Rapid City gets $116.1 million from GRT, funding $84 million for schools and more, so services stay strong. You and your tenants also get up to $325 each in rebates from the $200 million surplus. It’s a huge win for landlords, keeping more money in your pocket while supporting your tenants.

How do we ensure real estate investors get these massive tax breaks and pass them on through lower rent or more affordable housing, instead of just making more profit? How is that good for workers?

While the GRT plan doesn’t directly mandate that real estate investors pass on their tax savings, it creates strong incentives and market pressures to encourage lower rents and more affordable housing, benefiting workers in the process. The GRT eliminates $1.6 billion in property taxes state-wide, saving Rapid City landlords $3,000–$5,000 per property—$25,000–$50,000 for a large apartment building. When landlords save this much, competition can push them to lower rents to attract tenants, especially in a market like Rapid City where renters are cost-conscious. For example, if a landlord saves $50,000 on a 25-unit building, that’s $2,000 per unit annually—they could reduce rent by $150/month and still profit more than before, making housing more affordable.

Note on Liberty: Our plan is grounded in the spirit of liberty, seeking to replace property taxes to free families from the crushing debt of property taxes and give them breathing room. Just as the Founding Fathers valued freedom from oppressive government overreach, we aim to liberate South Dakotans from burdensome taxes, empowering families, workers, and investors alike to thrive.

Beyond competition, the GRT plan’s broader benefits help workers directly. The 2.5% GRT replaces the 6.5% sales tax in Rapid City on taxable items, so on a $20 purchase like dog food, you pay $0.50 instead of $1.30, saving you on daily costs. Plus, every voter, including workers, gets up to $325 from the $200 million rebate pool, putting cash back in your pocket. Rapid City gains $116.1 million from GRT, funding $84 million for schools and $22.4 million for police and fire, so your community services stay strong without higher rents covering property taxes. While we can’t force investors to lower rents, the GRT’s savings, market dynamics, and direct benefits to workers create a win-win—investors profit, and you save on rent and living costs.

Learn More

Visit sealSD.com/taxes for full details.
Join us April 19, 2025, at 2:00 PM at First Assembly of God in Rapid City!

Seal SD

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