The Republican candidates for governor of South Dakota are, from left, U.S. Rep. Dusty Johnson, Gov. Larry Rhoden, businessman Toby Doeden and state House Speaker Jon Hansen. (Photos by South Dakota Searchlight; illustration by Joshua Haiar/South Dakota Searchlight)
SIOUX FALLS, S.D. (South Dakota Searchlight) – The four Republican candidates for governor of South Dakota clashed over tax policies in their first debate Tuesday, as the leading candidate in the polls criticized two others for their support of higher sales taxes.
U.S. Rep. Dusty Johnson, who has led in polls released publicly so far, deployed the critique in a debate aired online and on television from the KELO studio in Sioux Falls.
“My problem isn’t that they did it once,” Johnson said. “They did it twice. They did it three times.”
Johnson alleged that Gov. Larry Rhoden and state House Speaker Jon Hansen were falsely calling themselves tax cutters.
“Jon and Larry have told you that they lowered your taxes. That’s not true,” Johnson said. “The reality is that they have raised your taxes.”
He then made the charge more specific, saying Rhoden “signed three sales tax increases just this legislative session.” Johnson called them “the largest tax increases in state history.”
Rhoden did sign three bills into law during the recently concluded legislative session that allow for new or higher sales taxes, although two of them require the revenue to be used for property tax reduction while the other allows for temporary sales taxes with revenue going to specific city projects.
One of the laws allows the statewide sales tax rate to increase from 4.2% to 4.5% next year, as lawmakers scheduled it to do when they temporarily lowered the rate in 2022. The new law would capture the estimated $114 million in revenue from the increase and use it to reduce homeowner property taxes. Another new law gives counties their first-ever option to impose a sales tax, which would be up to 0.5% with proceeds required to be used for homeowner property tax credits.
Hansen voted for each of those bills and against the third one.
The third law lets cities implement an additional 1% temporary sales tax to pay for special projects, if approved by 60% of a city’s voters. Cities can already impose a regular sales tax up to 2%, plus an additional 1% on lodging, prepared food, alcohol and event ticket sales.
Other candidates respond
Rhoden countered that Johnson’s own proposal for property tax relief, announced before the legislative session, would have used revenue from the scheduled statewide sales tax rate increase to provide property tax credits for homeowners.
Rhoden called Johnson’s criticism “D.C. B.S.”
“He laid out a proposal that used the exact same sales dollars for his property tax plan,” Rhoden said.
Hansen said he tried to keep the statewide sales tax at 4.2%, but lacking enough legislative support for that, he did “the next best thing,” which was “taking all of that revenue and putting it back into the people’s pockets for property tax relief.” He called it “the biggest one-time property tax relief bill in the history of the state of South Dakota.”
Businessman Toby Doeden described the property tax reduction bills supported by Rhoden and Hansen as “so-called property tax relief,” dependent on increased sales taxes.
“It’s the biggest sales tax increase in South Dakota history,” said Doeden, who has pledged to eliminate property taxes but has not released a specific plan to do it.
Doeden is a political newcomer and Aberdeen businessman who’s built and operated multiple businesses, including vehicle dealerships.
Rhoden is a welder, rancher and former legislator from rural Union Center in western South Dakota. He served as lieutenant governor to Kristi Noem and was elevated to governor when she resigned in January 2025 to lead the federal Department of Homeland Security.
Johnson, of Mitchell, has been South Dakota’s lone member of the U.S. House since 2019. He previously served on the South Dakota Public Utilities Commission and as chief of staff to former Gov. Dennis Daugaard. Johnson also previously worked for Vantage Point Solutions, a telecommunications engineering and consulting company.
Hansen is a lawyer from Dell Rapids and the speaker of the South Dakota House of Representatives.
On the economy and growth
Hansen said South Dakota should trust entrepreneurs and avoid using taxpayer money or incentives to lure big corporations to the state.
“And if you look back on the history of South Dakota, that has been the biggest driver of economic prosperity in South Dakota and, frankly, the world’s history,” Hansen said. “It’s called freedom and the free market.”
He alleged that government incentives for businesses distort the free market and can breed corruption.
Doeden said South Dakota’s economy is underperforming because career politicians have neglected small businesses. He said he would cut regulations, improve South Dakotans’ access to capital, and recruit companies leaving Democratic-leaning states.
“If we want to fix South Dakota’s lagging-behind economy, we have to, for the first time in a generation, elect a businessman outsider,” Doeden said.
Johnson said South Dakota’s business climate ranked 35th in a recent survey. He argued that the state should invest more in homegrown businesses “rather than chase around big corporate titans,” while also keeping taxes low.
“And we’re not doing a very good job of that right now,” Johnson said.
Rhoden said the state is performing well, saying the current approach is working and should be continued.
“Every week I’m going to ribbon cuttings and groundbreakings, and a lot of them were expansions or businesses that are moving here,” Rhoden said.
On Noem’s record
The KELO moderators asked the candidates to grade former Kristi Noem’s performance as governor.
Rhoden, who served as her lieutenant governor, gave her an A. He praised her refusal to shut down the state during the COVID-19 pandemic.
Doeden gave her a B. He credited her with making South Dakota a symbol of freedom during the pandemic and attracting like-minded people to the state.
Hansen gave her a C. He said lawmakers like him deserved more credit for keeping the state open during the pandemic, and the Legislature pushed harder than the governor’s office did on several issues important to conservative Republicans.
Johnson declined to grade Noem and criticized the question, telling the moderators “you guys are better journalists than this.”
“When we try to take a legacy of service like that and boil it down to a letter grade, I just think we’re playing paint-by-numbers politics rather than having a real conversation,” Johnson said.
Johnson went on to credit Noem with working to keep legislative factions together, working against human trafficking during her prior time in Congress, sending “a different message” to the country about freedom during the pandemic, and controlling the border during her recently concluded tenure running the U.S. Department of Homeland Security.
To win the June 2 primary, the leading vote-getter must reach at least 35% support. If nobody reaches that level, the top two vote-getters will advance to a runoff eight weeks later. The winner will advance to represent the Republican Party in the Nov. 3 general election for governor.
Early voting for the primary begins April 17, and the voter registration deadline is May 18.
Announced Democratic candidates for governor include Dan Ahlers, a former state legislator and executive director of the state Democratic Party, and Robert Arnold, a Dakota State University student who served as a legislative intern.
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