State of South Dakota
LEGISLATIVE ASSEMBLY, 2007
SENATE TAXATION COMMITTEE ENGROSSED NO. SB 42 - 01/31/2007
Introduced by: The Committee on Taxation at the request of the Department of Revenue and Regulation
cigarettes offered by manufacturers for gratis distribution as samples,
stamps are not
required to be affixed to sample packages if the manufacturer of the cigarette reports and pays
the tax directly to the state tax authority.
Section 3. That § 10-50-6 be amended to read as follows:
10-50-6. Any cigarette on which a tax has been paid,
payment being evidenced by
the affixing of
, is not subject to a further tax under this chapter.
However, any person, who possesses two thousand or more cigarettes that do not bear a tax
indicating that the South Dakota cigarette tax has been paid, shall pay the tax
imposed pursuant to § 10-50-3 plus a penalty equal to ten percent of the total tax due.
Section 4. That § 10-50-22 be repealed.
If the secretary of revenue and regulation determines that it is practicable to stamp
by impression packages of cigarettes by means of a metering machine, the secretary may, in lieu
of the distributor affixing stamps as provided by this chapter, authorize any licensed distributor
to use any metering machine approved by the secretary, such machine to be sealed by the
secretary of revenue before being used and to be used in accordance with the procedure
established by rule promulgated by the secretary pursuant to chapter 1-26.
Section 5. That § 10-50-23 be repealed.
Any licensed distributor authorized by the secretary of revenue and regulation to
affix stamps to packages by means of a metering machine shall file with the secretary a bond
issued by a surety company licensed to do business in this state in such amount as the secretary
may fix, conditioned upon the payment of the tax upon cigarettes so stamped, or shall enter into
a depository agreement with the secretary for the deposit of money or any other property to
secure payment of the tax and conditioned upon the payment of the tax upon cigarettes. The
bond shall be in full force and effect for a period of one year and a day after the expiration of
the bond, unless a certificate be issued by the secretary of revenue and regulation to the effect
that all taxes due to the state under this chapter have been paid. The depository agreement
hereinbefore provided shall be in full force and effect for a period of one year and a day after
the expiration of the same, or until or unless a certificate be issued by the secretary of revenue
and regulation to the effect that all taxes due to the state under this chapter have been paid.
Section 6. That § 10-50-24 be repealed.
The secretary of revenue and regulation shall cause each metering machine
approved by him to be read and inspected at least once a month and shall determine as of the
time of such inspection the amount of tax due from the distributor using such machine after
allowing for the discount, if any, as provided in § 10-50-18, which tax shall be due and payable
to the secretary of revenue upon demand of the secretary or his duly authorized agent.
Section 7. That § 10-50-24.1 be repealed.
The secretary of revenue and regulation may designate and appoint one or more
county treasurers as agents to read, inspect, sell stamp impressions and collect therefor, from
any meter machine approved by the secretary and under the procedure established by rule
promulgated by the secretary pursuant to chapter 1-26. Such county treasurer shall, on or before
the fifth day of each calendar month, transmit to the secretary of revenue and regulation a report
showing the number of stamp impressions sold, to whom sold, together with a remittance for
the stamp impressions sold during the period for which the report is made.
Section 8. That § 10-50-25 be amended to read as follows:
the secretary of revenue and regulation
that the collection
of the tax imposed by this chapter would be facilitated thereby,
any person, resident or located outside this state, engaged in the business of selling and shipping
cigarettes into this state and purchasing at least seventy-five percent of
the manufacturers thereof, and who is a resident of any state authorizing by law the licensing
of nonresidents, including residents of this state, to distribute cigarettes therein, upon complying
with the requirements of the secretary of revenue and regulation, to affix or cause to be affixed
the stamps required by this chapter on behalf of the purchasers of
cigarettes, who would
otherwise be taxable therefor
, and the
secretary of revenue and regulation may sell
stamps to such person as hereinbefore provided
, or the secretary of revenue and regulation
may authorize the use of a metering machine by such person as hereinbefore provided
Section 9. That § 10-50-30 be amended to read as follows:
10-50-30. Each distributor shall affix or cause to be affixed, in
manner as the
secretary of revenue and regulation may specify in rules promulgated pursuant to chapter 1-26,
to each individual package of cigarettes, to cartons containing more than one individual package
of three, four, or five cigarettes sold or distributed by such distributor, stamps of the proper
denomination, as required by this chapter
, or, in lieu thereof, an imprint impressed by means of
a suitable metering machine approved by the secretary of revenue and regulation. Such
shall be affixed by a distributor before the cigarettes are transferred out of the
distributor's premises, or in lieu thereof the amount of the tax due shall be entered on the invoice
and stamps sufficient in denominations and amount shall accompany
invoice on every
delivery of cigarettes.
Section 10. That § 10-50-31 be amended to read as follows:
10-50-31. Each dealer upon opening any shipping package containing any unstamped taxable articles for purposes of sale or delivery to consumers, shall immediately affix
the tax stamps required by this chapter.
Section 11. That § 10-50-32 be amended to read as follows:
10-50-32. No person, other than a person licensed pursuant to § 10-50-9, may sell, offer for
sale, display for sale, or possess with intent to sell, advertise for sale, ship or cause to be
shipped, or possess with intent to deliver to another person, any cigarettes which do not bear
or an imprint impressed by a suitable metering machine approved by the secretary as
provided by this chapter,
evidencing the payment of the tax imposed by this chapter.
of sales of all nonparticipating manufacturer cigarettes and any other information relied upon
in reporting to the secretary for a period of six years. The secretary may, in addition to any other
provision of law, impose and collect a monetary penalty in an amount not to exceed five
hundred dollars per day, for the failure of a distributor or wholesaler to timely or accurately
comply with this section. Any monetary penalty collected pursuant to this section shall be
deposited in the state general fund.
Section 14. That § 10-50-82 be amended to read as follows:
10-50-82. No distributor or wholesaler or other person may:
intermediaries, during the year in question, as measured by excise taxes collected by the state
on packs bearing the excise tax stamp
of the state, or on roll-your-own tobacco. The
secretary of revenue and regulation shall promulgate, pursuant to chapter 1-26, such rules as are
necessary to obtain information from any licensee, licensed under the authority of the
Department of Revenue and Regulation, to ascertain the amount of state excise tax paid on the
cigarettes of such tobacco product manufacturer for each year. The Department of Revenue and
Regulation may provide information obtained pursuant to this section as is necessary for a
tobacco product manufacturer to compute its escrow payment under § 10-50B-7.