It SHOULD be free. After all, there are plenty of excellent SQL packages that are completely free.
In reality, you can get the express edition for free, and this should be fine for your small database. Of course, Microsoft wants you to buy the full-blown version.
If your heart is set on a Microsoft-based solution, you can experiment with the express edition of SQL server (and the express edition of a programming language like C# or VB.NET) If you're using the database in a commercial environment, you should purchase the commercial license (which is expensive.)
However, you can have an equally powerful data solution for free if you consider open-source alternatives. The latest version of MySQL compares very well to SQL server, and is totally free (although you can purchase a support package if you want to)
You can use MySQL with .net languages, or with open-source languages (commonly Java, PHP, and Python)