A South Dakota legislative panel approved a measure last week that would repeal an intrastate truck tax.

The House Taxation Committee voted 14-1 Feb. 5 in favor of the bill, which would revoke a 4 percent state tax on freight picked up and delivered within the state. Out-of-state haulers are permitted to load and transport freight outside the state or bring products in without the same charge, the Rapid City Journalreported.

State Rep. Larry Rhoden, R-Union Center, the bill’s sponsor, told the committee before the vote that the tax, which brings in $3 million a year, is unfair.

“The juice isn’t worth the squeeze,” Rhoden said. “It’s the most unfair tax we have in the state. It gives South Dakotans an incentive to do their business outside the state. It also gives the people from outside the state an unfair competitive advantage.

“I honestly believe that this tax costs the state far more in revenues than it ever creates, not to mention the disincentive for businesses.”

HB1180 has been forwarded to the House floor for consideration.