The growing GDP did not correspond with increases in sales tax revenue: Fiscal Year 2010, which ran from July 1, 2009, to June 30 of this year, saw South Dakota's taxable sales drop 1.5%.
Hmm: more GDP, more income per person, but less sales to tax. Could it be that an income tax would more accurately reflect the growing wealth and growing service needs of our state?
Expanding the historical perspective, South Dakota's economy has done fairly well over the last couple decades. Crunching numbers from the Census Bureau and from USGovernmentSpending.com, I find that since 1992, our state GDP per capita—i.e., the amount of economic activity divided by the number of people around to enjoy it—has grown at an annual rate of 4.8%. Compare that with our neighboring states:
|GDP per capita:||SD||ND||MN||IA||NE||WY||MT||US|
|avg ann. incr||4.8%||5.2%||3.9%||4.5%||4.1%||5.2%||4.2%||3.7%|
Annual State Gross Domestic Product per Capita, 1992–2009
In our neighborhood, only Wyoming and North Dakota have outperformed us in annual GDP per capita increase, and those two states have benefited from oil and coal. By this metric, all of us up here in the Northern Plains have outperformed the national average, with all but Minnesota more than doubling our wealth per capita since 1992. Nationally, per capita GDP has increased just 87%. Only in five years of the last 17—1995, 1997, and 2004 through 2006—has South Dakota's per capita GDP grown more slowly than the national average.