This bill aims to classify nicotine products as tobacco products, increase tax rates on cigarettes and tobacco products, and establish a healthcare workforce development fund. Key amendments include redefining terms related to consumers, dealers, distributors, and tobacco products, with specific insertions clarifying the definitions. Notably, the tax rates on cigarettes are set to increase from seventy-six and one-half mills to one hundred fifty-one and one-half mills for both Class A and Class B cigarettes. Additionally, the tax on tobacco products will rise from thirty-five percent to forty-five percent of the wholesale purchase price.

Furthermore, the bill stipulates that the first forty-five million dollars in revenue collected annually will be allocated to the general fund, with subsequent amounts directed to the tobacco prevention and reduction trust fund and the newly created healthcare workforce development fund. This fund will be administered by the Department of Health, which is authorized to award grants for training healthcare workers and expanding the healthcare workforce in South Dakota. The bill emphasizes the continuous appropriation of expenditures from this fund, ensuring ongoing support for healthcare workforce development initiatives.

Statutes affected:
Introduced, 02/04/2025: 10-50-1, 10-50-3, 10-50-61, 10-50-52