S.D. Admin. R. 64:06:03:24
Gross receipts from sales to manufacturers, producers, or processors, including flour mills, bakeries, or creameries, any product transferred electronically, of tangible personal property of any kind, including gas, fuel, electricity, tools, and other property which is used by such manufacturers in the manufacturing process and which does not become an ingredient or component part of the tangible personal property manufactured, produced, or processed, are taxable. The manufacturer, producer, or processor is the final buyer or ultimate consumer of the tangible personal property and does not purchase it for resale. The tangible personal property and any product transferred electronically so purchased is not purchased by the manufacturer for the purpose of resale but for the operation of the business. If sales tax is not paid to a licensed South Dakota supplier, use tax must be paid to the state.
A business is liable for use tax on all items of tangible personal property and any product transferred electronically used by the business even though an item may have been especially fabricated to produce a product for a particular customer, is completely consumed in completing the customer's order, and the cost of the item is included in the charge to the customer.
S.D. Admin. R. 64:06:03:24
General Authority: SDCL 10-45-47.1(3), 10-46-35.1(3).
Law Implemented: SDCL 10-45-2.4, 10-46-2, 10-46-2.2.