GRT vs. Sales Tax

April 15, 2025
Seal SD Liberty

GRT vs. Sales Tax: How Our Plan Ends Property Taxes in South Dakota

South Dakotans, I’m Jerry Odom, running for governor to fight for your liberty and family values. A key part of our plan to end the $954 million property tax burden (SD News Watch, 2021-22) is the Gross Receipts Tax (GRT), and I’ve heard your questions about how it differs from a sales tax. Let’s break it down clearly: the GRT and sales tax work together to replace property taxes, ensuring economic freedom, accountability, and local control while freeing you from the taxman’s grip. Here’s an explainer on GRT versus sales tax, why our plan works for South Dakota, and how you can help make it a reality by joining us at the Liberty Forum!

What Is a Gross Receipts Tax (GRT)?

The GRT is a low-rate, broad-based tax on the total gross receipts of businesses operating in South Dakota. Unlike a sales tax, which consumers pay at the point of sale, the GRT is paid by businesses on all their revenue—whether from goods, services, or other transactions—before expenses are deducted.

  • Who Pays It? Businesses pay the GRT, not individuals directly. Our plan ensures fairness: small businesses earning under $100K pay zero GRT, and farmers benefit from lower rates (April 14, 2025).
  • Rate: The state sets a maximum GRT rate—say, 1.5%—that counties cannot exceed, ensuring consistency and preventing runaway tax hikes.
  • How It’s Collected: Counties collect the GRT from businesses within their jurisdiction, keeping the funds local to support schools, roads, and services—no property taxes needed (April 14, 2025).
  • Purpose: The GRT replaces property taxes, freeing South Dakotans from the $954 million burden while ensuring counties have the revenue they need to operate.

What Is a Sales Tax?

A sales tax is a consumption tax paid by consumers at the point of purchase on goods and some services. South Dakota already has a robust sales tax system in place, which plays a key role in our GRT plan.

  • Who Pays It? Consumers pay the sales tax directly when they buy taxable goods or services—like groceries, clothing, or gambling activities.
  • Rate: South Dakota’s state sales tax rate is 4.2%, with counties and cities adding local rates—for example, Custer County adds 1%, and Custer City adds another 1%, totaling 6.2% within the city (April 11, 2025).
  • How It’s Collected: The state collects sales taxes, including local portions, and redistributes the local share back to counties and cities for their use.
  • Current Revenue: South Dakota’s sales tax generates $1.5 billion annually (SD Dept of Revenue, 2023), including gambling revenue, providing a strong foundation to support counties alongside the GRT.

GRT vs. Sales Tax: Key Differences

Here’s how the GRT and sales tax differ, and how they work together in our plan to end property taxes:

  • Who Pays: The GRT is paid by businesses on their total receipts, while the sales tax is paid by consumers at the point of sale. This dual approach ensures fairness—businesses contribute through the GRT, and consumers through the sales tax, without adding new burdens on individuals.
  • Base of Taxation: The GRT taxes all business revenue, including B2B transactions, before expenses, while the sales tax applies only to consumer purchases of taxable goods and services. This broader GRT base allows a lower rate to generate sufficient revenue to replace property taxes.
  • Rate Structure: The GRT has a state-set maximum rate (e.g., 1.5%) that counties can’t exceed, ensuring predictability. Sales tax rates vary by location—4.2% state plus local add-ons—but our GRT plan doesn’t increase these rates; it leverages existing sales tax revenue.
  • Collection and Distribution: Counties collect the GRT locally, retaining the funds for their needs (April 14, 2025). The state collects sales taxes and redistributes local portions, ensuring both taxes support local control without property taxes.
  • Impact on Residents: The GRT eliminates property taxes, freeing families from the $954 million burden that forces tough choices—like paying taxes or affording groceries at $6.23/dozen for eggs (Post ID: 0). Sales taxes remain as they are, ensuring no new consumer burden.

How Our GRT Plan Ensures Economic Freedom, Accountability, and Local Control

Our GRT plan, combined with South Dakota’s existing sales tax revenue, creates a system that promotes economic freedom, accountability, and local control—all while ending property taxes:

  • Economic Freedom: By eliminating property taxes, our GRT plan frees South Dakotans to keep their homes without foreclosure fears—a direct violation of the Fifth Amendment (April 12, 2025). Small businesses under $100K pay zero GRT, and farmers get lower rates, encouraging growth without new corporate taxes (April 14, 2025). South Dakota’s low-wage environment attracts businesses (April 5, 2025), and our plan keeps it that way.
  • Accountability: The state sets a maximum GRT rate counties can’t exceed, preventing runaway tax hikes. Counties collect and manage GRT revenue, but must report how funds are used—transparency ensures accountability. Zero-based budgeting, already a state law (April 14, 2025), can be implemented to justify every expense, keeping counties in check.
  • Local Control: Counties collect GRT locally and retain the funds to meet their needs—schools like Hot Springs ($8.3 million budget, Web ID: 10), roads, and emergency services stay funded without property tax districts (April 14, 2025). The state’s $1.5 billion sales tax revenue and $109 million surplus (South Dakota Searchlight, 2023) provide a safety net, but your county keeps control.

Addressing Additional Concerns: Tourism, Gambling, and More

Our GRT plan doesn’t increase tourism taxes—cities can maintain their existing rates, and the GRT replaces property taxes, not adds to consumer levies (April 14, 2025). Gambling revenue is already part of the $1.5 billion sales tax pool, ensuring no new taxes are needed. School and municipal bond issues will be funded through the GRT, eliminating property tax levies while keeping communities strong. This plan is about fairness, freedom, and local control—but it needs your involvement to become reality.

Snarky Commentary: Progressive Socialists Posing as Americans

Progressives love taxing you into oblivion—$954 million in property taxes (SD News Watch) while they let 8 million illegal crossings since 2021 (Lamborn, 2023) bring chaos like Tren de Aragua to Aurora, CO (Web ID: 1)! They’d rather fund woke disasters than support local control—our GRT plan says no way! Liberty means keeping your money local, not in their socialist hands! #OdomForLiberty #SouthDakotaStrong #TaxReformSD #FreedomFirst

Join the Fight: Make Our GRT Plan a Reality

Our GRT plan, paired with South Dakota’s sales tax revenue, gives us the power to end property taxes—but it’s not my plan alone, it’s ours. I’m presenting this idea because I believe in our shared liberty, but it needs every South Dakotan to get involved. Join me at the Liberty Forum, April 19th, 2:00 PM, First Assembly of God, Rapid City—4 days away—to discuss how we’ll replace the $954 million property tax burden with a system that ensures economic freedom, accountability, and local control. Together, we’ll build a South Dakota where liberty reigns—share if you’re with me! #OdomForLiberty #SouthDakotaStrong #TaxReformSD #FreedomFirst