South Dakota’s IM 25
This November, voters will decide the fate of Initiated Measure 25, a $35 million tax increase in South Dakota. IM 25 imposes a $1 tax increase on each pack of cigarettes and a 57 percent increase on smokeless and other tobacco products, while creating a new government fund for the state’s postsecondary technical institutes.
Tobacco sales make up a significant portion of sales in convenience stores. If IM 25 passes, many retailers could be forced out of business, causing the loss of more than 400 jobs.
IM 25 could lead to more illegal cross-border sales of cigarettes and could result in more people purchasing tobacco products from Native American reservations, the Internet or through increased illicit sales. This increase in untaxed sales would lead to a loss of state tax revenue.
Earlier this year, the South Dakota Legislature rejected a similar proposal (H.B. 1274), voting overwhelmingly to defeat it in committee. Absentee voting in South Dakota begins September 21 and ballots must be received by 5 p.m. the day before election day.