This bill authorizes counties in South Dakota to impose a gross receipts tax of up to one-half percent on the gross receipts from sales of tangible personal property, electronically transferred products, and taxable services. The revenue generated from this tax is required to be deposited into a property tax reduction fund, which will be used to provide property tax relief specifically for owner-occupied properties. The governing body of the county must adopt an ordinance to implement this tax, which can also be referred to a public vote for approval. Additionally, the bill outlines the administrative responsibilities of the Department of Revenue in managing the tax and specifies that the gross receipts tax will not apply to materials incorporated in construction contracts that were bid or entered into before the tax's effective date.

Key amendments to existing laws include the requirement for property tax bills to indicate any property tax credits applied due to the gross receipts tax, and the ability for contractors to list the excise and use taxes as separate line items on contracts. The bill also clarifies that gross receipts do not include any taxes that are separately stated on invoices. Furthermore, it establishes guidelines for the allocation of funds from the property tax reduction fund and sets forth the conditions under which new ordinances or amendments can take effect. Overall, the bill aims to provide a mechanism for counties to generate revenue while simultaneously offering tax relief to property owners.

Statutes affected:
Introduced, 01/16/2026: 10-21-1.1, 10-46A-12, 10-46B-10, 10-52-1.1, 10-59-1