Note: Of South Dakota's neighbor states, NONE tax food.
Taxing groceries:

States that DO NOT tax food:

Alaska Maine North Carolina
Arizona Maryland North Dakota
California Massachusetts Ohio
Colorado Michigan Oregon
Connecticut Minnesota Pennsylvania
Delaware Montana Rhode Island
District of Columbia Nebraska South Carolina
Florida Nevada Texas
Georgia New Hampshire Vermont
Indiana New Jersey Washington
Iowa New Mexico Wisconsin
West Virginia
Kentucky New York
States with a lower rate for food:
Illinois taxes food at 1%.
Virginia taxes food at 2.5%.
Missouri taxes food at 1.225%.
South Carolina dropped 1% off its food tax, leaving 3%, then ended it Nov 1, 2007.
Arkansas cut their food tax in half, to 3%.
On Jan.1 '07, Utah dropped 2% off, leaving 2.75%. & dropped 1.5% on 1/1/08.
Tennessee taxed food at 6%,which is 1% less than everything else, and recently cut to 5.5%
On July 1, 2009, Arkansas cut their food tax further, to 2%.
West Virginia food tax has been reduced again, now to 1%, with the latest drop on January 1, 2013.

That leaves South Dakota among only 13 states taxing food, 7 at their full sales tax rates.
37 states and DC do not tax groceries.

Recent Food Tax Changes:
Oct. '96 - Georgia began phasing out of its food tax.
Jan. '97 - N. Carolina reduced its food tax by 1%.
Oct. '97 - Missouri reduced its food tax by 3% to 1.225%.
July '98 - N. Carolina reduced its food tax 1% more.
Oct. '98 - Georgia eliminated its state tax on food.
May '99 - N. Carolina eliminated its state food tax.
Jan. '00 - Virginia began phased reduction in state food tax from 3.5% to 1.5%.
Jan. '03 - Louisiana eliminated its food tax.
Feb. '03 - South Dakota required most cities to RAISE food tax by 1/1/04.
Jan. '04 - Most cities in South Dakota RAISED their food tax
Jan. '05 - New Mexico eliminated its food tax.
Jan. '06 - West Virginia dropped 1% off its food tax.
July '06 - Wyoming dropped all its food tax for the next two years.

Oct. '06 - South Carolina dropped 1% off its food tax.
Nov.'06 -
West Virginia legislature passed another % cut for 7/1/07 and another for 7/1/08
Jan. '07 - Utah's food tax went down 2%,
saving taxpayers the equivalent of 22 meals/year.
2007 - Wyoming legislature voted to make the end of food tax permanent.
July'07 - Arkansas food tax cut in half, from 6% to3%.
July'07 - West Virginia food tax goes down another per cent.
Nov'07 - South Carolina ended its state food tax.
Jan '08 - Tennessee's food tax gets its first drop, 1/2% off.
Jan '08 - Utah food tax went down another 1.5%.
July '08 - West Virginia's food tax dropped another 1%.
July'09 - Arkansas cut food tax down by another percent: 6% to 3% and now to 2%.
March 2011 - West Virginia legislature voted to cut another 1%.
Jan. 2012 - West Virginia's food tax dropped another 1%, leaving only 2% remaining.
July. 2012 - West Virginia's food tax dropped another 1%, leaving only 1% remaining.
Jan. 2013 - Food tax rebate program ended in South Dakota.
Jan. 2013 - Food tax refund program in Kansas became an income tax credit for certain groups.
July 1, 2013 - Food tax ends in West Virginia (phased out starting in 2005, from 6% to 0).

updated 1/25/14.