An Act to exempt from the state sales and use tax gross receipts for certain services to a partnership.

Be it enacted by the Legislature of the State of South Dakota:

Section 1. That a NEW SECTION be added to chapter 10-45:

The following are exempt from the provisions of this chapter and from the computation of the tax imposed by this chapter:

(1) Gross receipts from services rendered by a natural person to a business taxed as a partnership in which the natural person is an owner;

(2) Gross receipts from services rendered by a limited liability company, which has no employees and is wholly owned by a natural person, to a business taxed as a partnership in which the limited liability company is an owner; and

(3) Gross receipts from services rendered by a corporation, which is wholly owned by a natural person and has no employees other than its owner, to a business taxed as a partnership in which the corporation is an owner.

Section 2. That a NEW SECTION be added to chapter 10-46:

The following are exempt from the provisions of this chapter and from the computation of tax imposed by this chapter:

(1) Gross receipts from services rendered by a natural person to a business taxed as a partnership in which the natural person is an owner;

(2) Gross receipts from services rendered by a limited liability company, which has no employees and is wholly owned by a natural person, to a business taxed as a partnership in which the limited liability company is an owner; and

(3) Gross receipts from services rendered by a corporation, which is wholly owned by a natural person and has no employees other than its owner, to a business taxed as a partnership in which the corporation is an owner.