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Tourism Tax

Gains In Metro Areas Drive SD Tourism Tax Upward Trend

Taxable tourism sales in South Dakota increased 11.5 percent over 2015, continuing a five-year upward trend. The state recorded an eight-year high of nearly $831 million, up from $745 million in 2015 (all figures are inflation-adjusted for 2016 dollars). 

Taxable tourism sales in the Rushmore State’s metropolitan communities increased by 8.6 percent from 2015-2016 to more than $439 million. The Rapid City, Sioux Falls and Sioux City metro areas accounted for 52.9 percent of the state's tourism tax receipts in 2016, down from 55.1 percent in 2015 and 54.6 percent in 2016.

The Black Hills region—driven largely by the Pennington, Lawrence, Meade and Custer counties—delivered nearly half of the state's taxable tourism sales in 2016. Pennington County (home to Rapid City and Mount Rushmore) maintained its commanding lead, netting 27.4 percent of the state's taxable tourism sales in 2016. 

No. 2 Minnehaha County (home to Sioux Falls) put up nearly half of Pennington’s share at 14.1 percent. No. 3 was Lawrence County (home to Deadwood) at 8.7 percent, followed by No. 4 Meade County (home to Sturgis) at 5.6 percent and No. 5 Custer County at 4.4 percent. 

Lodging accounts for the vast majority of the state's taxable tourism sales. That sector made up 56 percent of taxable tourism sales in 2016. The No. 2 sector, shops and markets, accounted for 9 percent of taxable tourism sales in 2016, down from the six-year high of 14.8 percent recorded during a 2010 spike in taxable tourism sales. No. 3 visitor attractions accounted for 8.6 percent of taxable tourism sales in 2016, continuing a steady slide since 2009 when it was 12 percent.

Recreational services and rentals accounted for 5.4 percent in 2016, down from a five-year high of 11.1 percent in 2011. Restaurants totaled 3.7 percent in 2016, an eight-year high for that sector. Spectator events and "other visitor-related businesses" represented less than 1.0 percent, and 1.2 percent, respectively. 

 

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