CHAPTER 10-50
CIGARETTE TAX
10-50-1 Definition of terms.
10-50-2 Number of cigarettes in package.
10-50-3 Tax imposed on cigarettes held for sale--Rates of tax.
10-50-4 Stamps affixed to evidence tax payment--Samples excepted.
10-50-5 Denominations of stamps--Fractional parts of cent.
10-50-6 Stamped cigarettes not subject to further tax--Person in possession of unstamped cigarettes liable for tax and penalty.
10-50-7 Transactions constitutionally exempt from taxation.
10-50-8 Impact of tax borne by consumer--Separate statement on invoice--Method of collection unaffected.
10-50-9 License required of distributors and wholesalers--Registration required of retailers--Separate license or registration for each outlet--Violation as petty offense.
10-50-10 Contents of application for license.
10-50-11 Fee for distributor or wholesaler license--Reduced fee for part of year.
10-50-12 Display of license--Duration--Return of license on revocation.
10-50-13 Transfer of license to different location or person--Contents of application for transfer.
10-50-14 Annual renewal of license--Fee.
10-50-15 Revocation of license or registration--Appeal.
10-50-16 Sale of cigarettes after license or registration revocation as petty offense--Forfeiture.
10-50-17 10-50-17. Repealed by SL 1982, ch 28, § 51.
10-50-18 Stamps secured and sold by secretary--Discount.
10-50-19 Payment for stamps after purchase--Bond or depository agreement required.
10-50-20 Resale of stamps prohibited--Redemption of unused and uncanceled stamps.
10-50-20.1 Refund for stamped cigarettes destroyed by distributor.
10-50-21 Use or possession of counterfeit stamp as felony--Reuse of stamp.
10-50-22 10-50-22 to 10-50-24.1. Repealed by SL 2007, ch 66, §§ 4 to 7.
10-50-25 Authorization to nonresident to affix stamps--Sale of stamps.
10-50-26 Bond or depository agreement required of authorized nonresident--Duration of bond or agreement.
10-50-27 Agreement by nonresident to permit examination of records.
10-50-28 Appointment of attorney by authorized nonresident--Service of process on attorney--Notice to nonresident.
10-50-29 Authorized nonresident as licensed distributor.
10-50-30 Distributor to affix stamps.
10-50-31 Dealer to return unstamped cigarettes.
10-50-32 Sale of unstamped cigarettes as misdemeanor--Subsequent violation a felony.
10-50-33 Display or possession of unstamped cigarettes as evidence of intent to sell.
10-50-34 Enforcement powers of department personnel--Arrest--Complaint--Seizure of counterfeit license or stamp.
10-50-35 Unstamped cigarettes as contraband--Seizure without warrant.
10-50-36 Forfeiture and destruction of contraband cigarettes.
10-50-37 Confiscation of unstamped cigarettes not required if no intentional evasion.
10-50-38 Act of agent as act of principal.
10-50-39 Monthly reports by distributors--Contents and time of filing.
10-50-40 Records preserved by distributors, wholesalers and dealers.
10-50-41 Examination of distributor's, wholesaler's, and dealer's records--Inspection of premises--Records to be kept by dealer.
10-50-42 Investigations and taking of testimony.
10-50-43 Subpoena of witnesses and evidence in department hearings.
10-50-44 Witnesses not excused by self-incrimination--Evidence produced not used against witness.
10-50-45 Judicial enforcement of departmental process--Commitment to jail--Further proceedings by secretary.
10-50-46 Application for hearing by secretary--Notice of grant or denial of hearing.
10-50-47 Hearing ordered by secretary--Requiring appearance of witnesses and production of evidence.
10-50-48 Secretary's order after hearing--Copy to applicant.
10-50-49 Appeal from secretary to circuit court--Notice of appeal.
10-50-50 Service of notice of appeal--Notice and bond filed with clerk of courts--Time of hearing by court.
10-50-51 Relief granted by circuit court--Costs.
10-50-52 Disposition of proceeds of tax.
10-50-53 10-50-53 to 10-50-57. Repealed by SL 1970, ch 78, § 14.
10-50-58 Cigarette stamp purchasing fund established.
10-50-59 Recovery of cigarette stamp costs--Deposit of funds.
10-50-60 Promulgation of rules.
10-50-61 Wholesale tax on tobacco products--Credit for tax paid.
10-50-62 Dealers to buy only from licensed wholesalers and distributors who have paid taxes--Violation as misdemeanor.
10-50-63 Deadline for reporting and remitting wholesale tobacco tax--Penalty--Credit or refund for destroyed unfit tobacco.
10-50-64 Voluntary regulation of use of tobacco products.
10-50-65 Certain activities regarding for-export-only tobacco products prohibited--Violation as misdeameanor.
10-50-66 Seizure and destruction of contraband tobacco products.
10-50-67 Relief for violation of § 10-50-65.
10-50-68 10-50-68 to 10-50-71. Repealed by SL 2003, ch 74, §§ 22 to 25.
10-50-72 Definition of terms.
10-50-73 Manufacturer to certify participation or compliance--Form--Delivery--Contents.
10-50-74 Certification update--Supplemental certification.
10-50-75 Inclusion of brand families--Requirements--No limitation on rights of State.
10-50-76 Maintenance of records--Exception.
10-50-77 Annual publication of directory on internet website--Date of publication--Development, contents and maintenance.
10-50-78 Exclusion from directory--Cure.
10-50-79 Hearing and appeal.
10-50-80 Distributors and wholesalers to submit information to secretary--Maintenance and availability of records--Monetary penalty--Deposit in general fund.
10-50-81 Secretary may require additional information.
10-50-82 Inclusion in directory prerequisite to affixing tax stamp or distribution--Monetary penalty--Deposit in general fund.
10-50-83 Inclusion of unregistered nonresident or foreign manufacturers in directory--Service of process--Information to be provided to secretary.
10-50-84 Notice to secretary of agent's authority--Termination or appointment of agent.
10-50-85 Service upon secretary of state in lieu of appointed or designated agent--Such service does not constitute compliance.
10-50-86 Disclosure of information to attorney general--Inter-agency sharing of information.
10-50-87 Financial information to be made available to attorney general.
10-50-88 Declaration of contraband--Seizure, forfeiture and destruction.
10-50-89 Promulgation of rules--Certification, reporting and directory.
10-50-90 Attorney general may seek restraining order--Action for enforcement--Compensation for costs.
10-50-91 Schedule of reports--Publication--Pre-publication sales, distribution, etc.
10-50-92 Conflict with other law.
10-50-93 10-50-93 to 10-50-98. Repealed by SL 2009, ch 58, §§ 2 to 7.
10-50-99 Shipment or transportation of cigarettes and tobacco products to consumers by sellers or distributors prohibited.
10-50-100 Injunction for actual or threatened violation.
10-50-101 Civil action for violation--Civil penalty.
10-50-102 Separate violations.
10-50-103 Forfeiture of products, profits, and benefits.
10-50-104 Other available penalties and remedies--Tax collected from person receiving products.
10-50-105 Provider of roll-your-own machine is cigarette manufacturer--Exception.
10-50-106 Only products in directory to be used in roll-your-own machine.
10-50-107 Seizure and destruction of tobacco products not purchased from licensed distributor or wholesaler.
10-50-1. Definition of terms.
Terms used in this chapter mean:
(1) "Consumer," any individual who is not a retailer or a licensed distributor or wholesaler pursuant to § 10-50-9;
(2) "Dealer," or "retailer," any person other than a distributor or wholesaler, as defined herein, who is engaged in this state in the business of selling cigarettes or tobacco products at retail;
(3) "Distributor," any person engaged in this state in the business of producing or manufacturing cigarettes, or importing into the state cigarettes, at least seventy-five percent of which are purchased directly from the manufacturers thereof;
(4) "Licensed distributor," or "licensed wholesaler," a distributor or wholesaler licensed under the provisions of this chapter;
(5) "Person," any individual, firm, fiduciary, partnership, limited liability company, corporation, trust, or association, however formed;
(6) "Sale" or "sell," shall include or apply to gifts, exchanges, and barter;
(7) "Secretary," the secretary of revenue;
(8) "Tobacco products," cigars, snuff, chewing tobacco, and any other products made up or composed of tobacco in whole or in part, except cigarettes.
Source: SDC 1939, § 57.3901; SL 1951, ch 452, § 1; SL 1970, ch 78, § 1; SL 1973, ch 2, § 278; SL 1994, ch 351, § 27; SL 1995, ch 72, § 5; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2005, ch 82, § 1; SL 2009, ch 58, § 1; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-2. Number of cigarettes in package.
All cigarettes sold in this state shall be put up in packages containing twenty or twenty-five cigarettes each except for those cigarettes offered by manufacturers for gratis distribution as samples. Manufacturers, through their sales representatives or agents, may distribute, within the state, sample cigarettes in any package size or quantity.
Source: SL 1937, ch 243, § 5; SDC 1939, § 57.3905; SL 1949, ch 422, § 1; SL 1951, ch 452, § 3; SL 1955, ch 416; SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1; SL 1984, ch 101, § 1.
10-50-3. Tax imposed on cigarettes held for sale--Rates of tax.
A tax is imposed, whether or not a sale occurs, at the following rates on all cigarettes held in this state for sale by any person:
Class A, on cigarettes weighing not more than three pounds per thousand, seventy-six and one-half mills on each cigarette.
Class B, on cigarettes weighing more than three pounds per thousand, seventy-six and one-half mills on each cigarette.
Source: SDC 1939, § 57.3905; SL 1949, ch 422, § 1; SL 1951, ch 452, § 3; SL 1955, ch 416; SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1; SL 1969, ch 271, § 1; SL 1979, ch 90, § 1; SL 1981, ch 114, § 1; SL 1985, ch 97; SL 1995, ch 72, § 1; SL 2003, ch 72, § 1; Initiated Measure 2, approved Nov. 7, 2006, eff. Jan. 1, 2007.
10-50-4. Stamps affixed to evidence tax payment--Samples excepted.
The payment of the tax imposed by § 10-50-3 shall be evidenced by the affixing of stamps to the packages containing the cigarettes as provided by this chapter. However, for cigarettes offered by manufacturers for gratis distribution as samples, the 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.
Source: SDC 1939, § 57.3905; SL 1949, ch 422, § 1; SL 1951, ch 452, § 3; SL 1955, ch 416; SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1; SL 1984, ch 101, § 2; SL 1995, ch 72, § 6; SL 2003, ch 272, § 82; SL 2007, ch 66, § 2.
10-50-5. Denominations of stamps--Fractional parts of cent.
No stamps evidencing payment of the tax prescribed in § 10-50-3 shall be in a denomination of less than one cent and whenever the tax at the rate therein prescribed shall be a specified amount plus a fractional part of one cent, the package or carton shall be stamped for the next full cent, provided, that whenever the tax at the rate therein prescribed shall amount to twelve cents the package or carton shall be stamped for the exact amount of twelve cents.
Source: SDC 1939, § 57.3905 as added by SL 1949, ch 422, § 1; SL 1951, ch 452, § 3; SL 1955, ch 416; SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1; SL 1969, ch 271, § 2.
10-50-6. Stamped cigarettes not subject to further tax--Person in possession of unstamped cigarettes liable for tax and penalty.
Any cigarette on which a tax has been paid, the payment being evidenced by the affixing of the stamp, 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 stamp 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.
Source: SDC 1939, § 57.3905; SL 1949, ch 422, § 1; SL 1951, ch 452, § 3; SL 1955, ch 416; SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1; SL 2000, ch 64, § 1; SL 2007, ch 66, § 3.
10-50-7. Transactions constitutionally exempt from taxation.
Nothing contained in this chapter shall be construed to impose a tax on any transaction the taxation of which by this state is prohibited by the Constitution of the United States.
Source: SL 1937, ch 243, § 5; SDC 1939, § 57.3905; SL 1949, ch 422, § 1; SL 1951, ch 452, § 3; SL 1955, ch 416; SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1.
10-50-8. Impact of tax borne by consumer--Separate statement on invoice--Method of collection unaffected.
The impact of the tax levied by this chapter is hereby declared to be on the vendee, user, consumer, or possessor of cigarettes or tobacco products in this state and when said tax is paid by any other person such payment shall be considered as an advance payment and shall thereafter be added to the price of the cigarettes or tobacco products and recovered from the ultimate consumer or user. In making a sale of cigarettes or tobacco products in this state a distributor may separately state and show upon the invoice covering such sale the amount of tax on the cigarettes or tobacco products sold. The provisions of this section shall in no way affect the method of collection of such tax on cigarettes as now provided by existing law.
Source: SDC 1939, § 57.3905 as added by SL 1959, ch 442, § 1; SL 1963, ch 446, § 1; SL 1965, ch 293, § 1; SL 1970, ch 78, § 2; SL 1995, ch 72, § 7.
10-50-9. License required of distributors and wholesalers--Registration required of retailers--Separate license or registration for each outlet--Violation as petty offense.
Each person, except a retailer, engaging in the business of selling cigarettes or tobacco products in this state, including any distributor or wholesaler, shall secure a license therefore from the secretary of revenue. A separate application and license is required for each wholesale outlet if a person owns or controls more than one place of business dealing in cigarettes or tobacco products. Each person selling cigarettes or tobacco products at retail shall register with the Department of Revenue. A separate registration is required for each retail outlet operated within the state. No fee may be charged for this registration.
Any person, except a retailer, who sells, offers for sale, or possesses with intent to sell, any cigarettes or tobacco products, without a license or registration commits a petty offense.
Source: SDC 1939, §§ 57.3903, 57.9932; SL 1941, ch 352; SL 1951, ch 452, § 2; SL 1955, ch 415; SL 1982, ch 86, § 73; SL 1995, ch 72, § 8; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2007, ch 64, § 1; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-10. Contents of application for license.
Such license shall be issued by the secretary of revenue on application, stating, on forms prescribed by the secretary, the name and address of the applicant, the address of the place of business at which it is proposed to engage in such business, the type of business, and such other information as the secretary may require for the proper administration of this chapter.
Source: SDC 1939, § 57.3903; SL 1941, ch 352; SL 1951, ch 452, § 2; SL 1955, ch 415; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-11. Fee for distributor or wholesaler license--Reduced fee for part of year.
Each application for a distributor or wholesaler license shall be accompanied by a fee of one hundred fifty dollars. If the applicant for a license has not entered upon the business of selling cigarettes or tobacco products until after the first day of January in any year, then the fee for a license during the remainder of the fiscal year is one-half the amount set forth in this section.
Source: SL 1937, ch 243, § 2; SDC 1939, § 57.3903; SL 1941, ch 352; SL 1951, ch 452, § 2; SL 1955, ch 415; SL 1966, ch 157, § 14; SL 1970, ch 78, § 3; SL 1995, ch 72, § 9.
10-50-12. Display of license--Duration--Return of license on revocation.
Each license so issued shall be prominently displayed on the premises covered by the license. Each license shall be valid until the first day of July subsequent to the date of issuance of such license unless sooner revoked by the secretary of revenue pursuant to the provisions of this chapter, in which case the holder of the license shall immediately return it to the secretary of revenue.
Source: SDC 1939, § 57.3903; SL 1941, ch 352; SL 1951, ch 452, § 2; SL 1955, ch 415; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-13. Transfer of license to different location or person--Contents of application for transfer.
Any license granted under this chapter may be transferred to a new location or to another person. If the transfer is to another person, the licensee shall show in writing, under oath, that the licensee has made a bulk sale of the business operated under the license. The transferee shall make an application exactly as if an original applicant, setting forth therein that the transferee is the bulk sale purchaser of the business operated under the license and requesting that the license be transferred to him or her. If the transfer is to a new location, the licensee shall make application showing all the relevant facts as to the new location. The application shall take the same course and be acted upon as if an original application.
Source: SDC 1939, § 57.3903 as added by SL 1941, ch 352; SL 1951, ch 452, § 2; SL 1955, ch 415; SL 2007, ch 64, § 2.
10-50-14. Annual renewal of license--Fee.
The holder of each license may, annually, before the expiration date of the license then held by him, renew his license for a further period of one year, on application accompanied by a fee in the amount as prescribed in § 10-50-11.
Source: SL 1937, ch 243, § 3; SDC 1939, § 57.3903; SL 1941, ch 352; SL 1951, ch 452, § 2; SL 1955, ch 415.
10-50-15. Revocation of license or registration--Appeal.
The secretary of revenue may revoke the license of any distributor or wholesaler or the registration of a dealer for failure to comply with any of the provisions of this chapter. Any person aggrieved by the revocation may apply to the secretary for a hearing as provided in § 10-50-46 and may further appeal to the court as provided in § 10-50-49.
Source: SDC 1939, § 57.3904; SL 1970, ch 78, § 4; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2007, ch 64, § 3; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-16. Sale of cigarettes after license or registration revocation as petty offense--Forfeiture.
Any person who sells any cigarettes or tobacco products after such person's license or registration has been revoked commits a petty offense, and all cigarettes or tobacco products in such person's possession shall be seized and forfeited to the state pursuant to chapter 23A-37.
Source: SL 1937, ch 243, § 4; SDC 1939, § 57.9933; SL 1982, ch 86, § 74; SL 1995, ch 72, § 10; SL 2007, ch 64, § 8.
10-50-18. Stamps secured and sold by secretary--Discount.
The secretary of revenue shall secure stamps, of the design and denomination as the secretary prescribes, suitable to be affixed to packages of cigarettes as evidence of the payment of the tax imposed by this chapter. The secretary shall sell the stamps to licensed distributors at a discount of one percent of their face value and to no other person.
Source: SDC 1939, § 57.3906; SL 1951, ch 452, § 4; SL 1963, ch 446, § 2; SL 1965, ch 293, § 2; SL 1969, ch 271, § 3; SL 1970, ch 78, § 5; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2007, ch 66, § 1; SL 2010, ch 67, § 1; SL 2010, ch 67, § 2, eff. July 1, 2012; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-19. Payment for stamps after purchase--Bond or depository agreement required.
The secretary of revenue may, in his discretion, permit a licensed distributor to pay for such stamps within thirty days after the date of purchase, provided a bond satisfactory to the secretary of revenue in an amount not less than the sale price of such stamps shall have been filed with the secretary conditioned upon payment for such stamps or upon a satisfactory depository agreement between the secretary of revenue and such licensed distributor, provided for a deposit of money or security in a depository to be named, such agreement conditioned upon payment for such stamps.
Source: SDC 1939, § 57.3906; SL 1951, ch 452, § 4; SL 1963, ch 446, § 2; SL 1965, ch 293, § 2; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-20. Resale of stamps prohibited--Redemption of unused and uncanceled stamps.
No distributor shall sell or transfer any stamps issued under the provisions of this chapter. The secretary of revenue shall redeem any unused, uncanceled stamps presented by any licensed distributor at a price equal to ninety-five percent of their face value.
Source: SDC 1939, § 57.3907; SL 1970, ch 78, § 6; SL 1974, ch 103, § 1; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-20.1. Refund for stamped cigarettes destroyed by distributor.
Whenever a distributor destroys cigarettes accidentally or intentionally because of staleness or other unfitness for sale which have been stamped as provided in this chapter, a credit or refund shall be given to the distributor at a price equal to ninety-five percent of the face value of the stamps upon proof of loss presented to the department within one year after the destruction of the stamped cigarettes if loss is established to the satisfaction of the Department of Revenue.
Source: SL 1974, ch 103, § 2; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-21. Use or possession of counterfeit stamp as felony--Reuse of stamp.
Any person who forges a counterfeit of any stamp prescribed by the secretary of revenue under the provisions of this chapter, or who uses a counterfeited stamp, or who knowingly possesses a counterfeited stamp, or who uses more than once any stamp required by this chapter, for the purpose of evading the tax thereby imposed, is guilty of a Class 4 felony.
Source: SDC 1939, § 57.9935; SL 1982, ch 86, § 75; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-25. Authorization to nonresident to affix stamps--Sale of stamps.
If the secretary of revenue finds that the collection of the tax imposed by this chapter would be facilitated thereby, the secretary may authorize 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 cigarettes from 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, to affix or cause to be affixed the stamps required by this chapter on behalf of the purchasers of the cigarettes, who would otherwise be taxable therefor. The secretary of revenue may sell the stamps to such person as hereinbefore provided.
Source: SDC 1939, § 57.3909; SL 1951, ch 452, § 6; SL 1957, ch 473; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2007, ch 66, § 8; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-26. Bond or depository agreement required of authorized nonresident--Duration of bond or agreement.
The secretary of revenue shall require bond of such nonresident person, satisfactory to the secretary of revenue, in an amount not to exceed ten thousand dollars, which said bond shall be filed with the secretary of revenue conditioned upon the payment of the tax in compliance with such other requirements as the secretary of revenue may specify. Such bond shall be issued by a surety company licensed to do business in this state, and shall be in full force and effect for a period of one year and a day after the expiration of the bond, and until or unless a certificate be issued by the secretary of revenue to the effect that all taxes due to the state under this chapter have been paid. In the discretion of the secretary of revenue, a depository agreement may be accepted by the secretary of revenue in lieu of such surety bond, which said depository agreement shall be upon the same conditions as the bond above referred to, and shall be in full force and effect for one year and a day and until or unless a certificate be issued by the secretary of revenue to the effect that all taxes due to the state under this chapter have been paid.
Source: SDC 1939, § 57.3909; SL 1951, ch 452, § 6; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-27. Agreement by nonresident to permit examination of records.
Such nonresident person shall agree to submit his books, accounts, and records to examination during reasonable business hours by the secretary of revenue or his duly authorized agent.
Source: SDC 1939, § 57.3909; SL 1951, ch 452, § 6; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-28. Appointment of attorney by authorized nonresident--Service of process on attorney--Notice to nonresident.
Each such nonresident person, other than a foreign corporation which has complied with the provisions of the statutes of this state relative to foreign corporations, shall, in writing, appoint the secretary of state and his successors in office to be his attorney, such appointment to be made, acknowledged, and filed in the manner prescribed in the statutes relative to foreign corporations. Service upon said attorney shall be sufficient service upon any such nonresident person, whether a foreign corporation which has complied with the provisions of the statutes relating to foreign corporations or not, and may be made by leaving a true copy of the process with the secretary of state or at his office. When legal process against any such nonresident person shall be served upon the secretary of state he shall notify such nonresident person in the manner specified in the statutes relating to service of process upon foreign corporations licensed to do business in this state, and shall collect the fee as therein specified.
Source: SL 1937, ch 243, § 9; SDC 1939, § 57.3909; SL 1951, ch 452, § 6.
10-50-29. Authorized nonresident as licensed distributor.
Any person complying with the provisions of §§ 10-50-25 to 10-50-28, inclusive, shall thereupon become a licensed distributor within the meaning of this chapter and shall be subject to all provisions of this chapter applicable to licensed distributors.
Source: SL 1937, ch 243, § 9; SDC 1939, § 57.3909; SL 1951, ch 452, § 6.
10-50-30. Distributor to affix stamps.
Each distributor shall affix or cause to be affixed, in the manner as the secretary of revenue may specify in rules promulgated pursuant to chapter 1-26, to each individual package of cigarettes, stamps of the proper denomination, as required by this chapter. The stamps shall be affixed by a distributor before the cigarettes are transferred out of the distributor's premises.
Source: SDC 1939, § 57.3910; SL 1949, ch 422, § 2; SL 1951, ch 452, § 7; SL 1987, ch 82, § 43; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2007, ch 66, § 9; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011; SL 2014, ch 65, § 1.
10-50-31. Dealer to return unstamped cigarettes.
Each dealer upon opening any shipping package containing any unstamped taxable articles for purposes of sale or delivery to consumers, shall immediately return the cigarettes to the distributor.
Source: SL 1937, ch 243, § 11; SDC 1939, § 57.3911; SL 2007, ch 66, § 10; SL 2014, ch 65, § 2.
10-50-32. Sale of unstamped cigarettes as misdemeanor--Subsequent violation a felony.
No person, other than a licensed distributor, 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, including cigarettes made by a roll-your-own machine as described in § 10-50-105, which do not bear stamps evidencing the payment of the tax imposed by this chapter.
A violation of this section is a Class 2 misdemeanor. Any subsequent violation is a Class 6 felony.
Source: SDC 1939, §§ 57.3912, 57.9934; SL 1951, ch 452, § 8; SL 1982, ch 86, § 76; SL 2003, ch 73, § 1; SL 2007, ch 64, § 4; SL 2007, ch 66, § 11; SL 2014, ch 65, § 3.
10-50-33. Display or possession of unstamped cigarettes as evidence of intent to sell.
The display or possession, except in original unopened shipping package, container, or case, of cigarettes by any dealers unless fully stamped as required by this chapter shall constitute prima facie evidence of possession with intent to sell the same.
Source: SL 1937, ch 243, § 12; SDC 1939, § 57.3912; SL 1951, ch 452, § 8.
10-50-34. Enforcement powers of department personnel--Arrest--Complaint--Seizure of counterfeit license or stamp.
The secretary of revenue and inspectors of the Department of Revenue are charged with the duty of enforcing the provisions of this chapter, and are given the power of peace officers and authorized and empowered to arrest any violator of the provisions of this chapter, to enter complaint before any court of competent jurisdiction and to seize without formal warrant and use as evidence any forged, counterfeited, spurious, or altered license or stamp found in possession of any person in violation of this chapter.
Source: SDC 1939, § 57.3902; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-35. Unstamped cigarettes as contraband--Seizure without warrant.
Any cigarettes found at any place in this state without stamps affixed thereto as required by this chapter unless the cigarettes are in the possession of a licensed distributor or wholesaler in the original unopened shipping package or unless they are in a course of transit from without this state and consigned to a licensed distributor or a licensed wholesaler, are declared to be contraband goods and may be seized by the secretary, the secretary's agents, or employees, or by any law enforcement of this state if directed by the secretary to do so, without a warrant.
Source: SDC 1939, § 57.3913; SL 1951, ch 452, § 9; SL 1970, ch 78, § 10; SL 2003, ch 272, § 82; SL 2007, ch 66, § 12.
10-50-36. Forfeiture and destruction of contraband cigarettes.
Any cigarettes seized under the provisions of this chapter shall be confiscated, forfeited to the state, and destroyed.
Source: SDC 1939, § 57.3913; SL 1951, ch 452, § 9; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011; SL 2019, ch 66, § 1.
10-50-37. Confiscation of unstamped cigarettes not required if no intentional evasion.
Nothing in § 10-50-35 or 10-50-36 shall be construed to require the secretary of revenue to confiscate unstamped cigarettes when he shall have reason to believe that the owner thereof is not willfully or intentionally evading the tax imposed by this chapter.
Source: SDC 1939, § 57.3913; SL 1951, ch 452, § 9; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-38. Act of agent as act of principal.
For the purpose of this chapter, the act or omission of any officer, agent, or other person acting for or employed by any person, corporation, limited liability company, association, or partnership within the scope of that office, agency, or employment is deemed to be the act or omission of such person, corporation, limited liability company, association, or partnership as well as that person's own.
Source: SL 1937, ch 243, § 13; SDC 1939, § 57.3913; SL 1951, ch 452, § 9; SL 1994, ch 351, § 28.
10-50-39. Monthly reports by distributors--Contents and time of filing.
On or before the fifteenth day of each month each distributor shall render to the secretary of revenue a verified report of all sales and deliveries on forms prescribed by the secretary, showing the quantity of cigarettes sold or delivered in this state during the preceding calendar month, the amount of stamps purchased and used during such period of time and the amount of stamps on hand at the end of the reporting period and such other information as the secretary shall require.
Source: SDC 1939, § 57.3914 as added by SL 1955, ch 417; SL 1970, ch 78, § 11; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-40. Records preserved by distributors, wholesalers and dealers.
Each distributor, wholesaler, and dealer shall keep complete and accurate records of all cigarettes or tobacco products manufactured, produced, purchased, or sold. Such records shall be of such kind and such form as the secretary of revenue may prescribe and shall be safely preserved for three years in such manner as to ensure permanency and accessibility for inspection by the secretary.
Source: SDC 1939, § 57.3914; SL 1951, ch 452, § 10; SL 1955, ch 417; SL 1970, ch 78, § 12; SL 1995, ch 72, § 11; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-41. Examination of distributor's, wholesaler's, and dealer's records--Inspection of premises--Records to be kept by dealer.
The secretary of revenue may examine the books, papers, and records of any distributor, wholesaler, or dealer in this state, for the purpose of determining whether the tax imposed by this chapter has been fully paid, and may investigate and examine the stock of cigarettes or tobacco products in or upon any premises where the cigarettes or tobacco products are possessed, stored, or sold, for the purpose of determining whether the provisions of this chapter are being obeyed. The secretary may make the inspections and examinations at any time during ordinary business hours, and may inspect at the times the premises and all desks, safes, vaults, and other fixtures and furniture contained in or upon the premises for the purpose of ascertaining whether cigarettes or tobacco products are held or possessed in violation of this chapter. Each dealer shall keep documents establishing that the cigarettes and tobacco products in the dealer's inventory were purchased from a distributor or wholesaler licensed by the State of South Dakota. The documents shall be kept for at least three months. If the documents are not stored at the dealer's registered location, the documents shall be made available in physical or electronic form to the secretary within five business days of the receipt of the request from the secretary.
Source: SDC 1939, § 57.3914; SL 1951, ch 452, § 10; SL 1955, ch 417; SL 1970, ch 78, § 13; SL 1995, ch 72, § 12; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2007, ch 64, § 5; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-42. Investigations and taking of testimony.
The secretary of revenue and any agent of the secretary duly authorized to conduct any inquiry, investigation, or hearing hereunder shall have power to administer oaths and take testimony under oath relative to the matter of inquiry or investigation.
Source: SDC 1939, § 57.3915; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-43. Subpoena of witnesses and evidence in department hearings.
At any hearing ordered by the secretary of revenue, the secretary or his agent is authorized to conduct such hearing and having authority by law to issue such process, may subpoena witnesses and require the production of books, papers, and documents pertinent to such inquiry.
Source: SDC 1939, § 57.3915; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-44. Witnesses not excused by self-incrimination--Evidence produced not used against witness.
No witness under subpoena authorized to be issued by the provisions of this chapter shall be excused from testifying or from producing books or papers on the ground that such testimony or the production of such books or other documentary evidence would tend to incriminate him, but such evidence or the books or papers so produced shall not be used in any criminal proceeding against him.
Source: SL 1937, ch 243, § 16; SDC 1939, § 57.3915.
10-50-45. Judicial enforcement of departmental process--Commitment to jail--Further proceedings by secretary.
If any person shall disobey the process authorized by § 10-50-43 or having appeared in obedience thereto shall refuse to answer any pertinent question put to him by the secretary of revenue or his authorized agent or to produce any books and papers pursuant thereto, the secretary or such agent may apply to the circuit court for the county wherein the taxpayer resides or wherein the business has been conducted, or to any judge of said court if the same shall not be in session, setting forth such disobedience to process or refusal to answer, and said court or such judge shall cite such person to appear before said court or such judge to answer such question or to produce such books and papers, and, upon his refusal so to do, shall commit him to jail until he shall testify, but not for a longer period than sixty days. Notwithstanding the serving of the term of such commitment by any person, the secretary may proceed in all respects with such inquiry and examination as if the witness had not previously been called upon to testify.
Source: SDC 1939, § 57.3915; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-46. Application for hearing by secretary--Notice of grant or denial of hearing.
Any person aggrieved by any action under this chapter of the secretary of revenue or his authorized agent for which hearing is not elsewhere provided may apply to the secretary, in writing, within ten days after the notice of such action is delivered or mailed to him, for a hearing, setting forth the reasons why such hearing should be granted and the manner of relief sought. The secretary shall promptly consider each such application and may grant or deny the hearing requested. If the hearing be denied, the applicant shall be notified thereof forthwith; if it be granted, the secretary shall notify the applicant of the time and place fixed for such hearing.
Source: SDC 1939, § 57.3916; SL 1951, ch 452, § 11; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-47. Hearing ordered by secretary--Requiring appearance of witnesses and production of evidence.
The secretary of revenue may, by notice in writing, at any time, order a hearing and require the taxpayer or any other individual whom the secretary believes to be in possession of information concerning any manufacture, importation, or sale of cigarettes or tobacco products which have escaped taxation to appear before the secretary with any specific books of account, papers, or other documents, for examination relative thereto.
Source: SDC 1939, § 57.3916; SL 1951, ch 452, § 11; SL 1995, ch 72, § 13; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-48. Secretary's order after hearing--Copy to applicant.
After any such hearing, the secretary of revenue may make such order in the premises as may appear to him just and lawful and shall furnish a copy of such order to the applicant.
Source: SDC 1939, § 57.3916; SL 1951, ch 452, § 11; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-49. Appeal from secretary to circuit court--Notice of appeal.
Any person aggrieved because of any action or decision of the secretary of revenue under the provisions of this chapter may appeal therefrom to the circuit court for the county of the taxpayer's residence or place of business, which appeal shall be taken by a notice of appeal in writing, setting forth the grounds upon which the appeal is taken or the action or decision of the secretary of which the appellant is aggrieved.
Source: SDC 1939, § 57.3917; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-50. Service of notice of appeal--Notice and bond filed with clerk of courts--Time of hearing by court.
Such appeal shall be perfected by the serving of a copy of the notice of appeal upon the secretary of revenue and filing the same with the clerk of courts of the county in which the appeal is taken, together with the filing with said clerk of courts of a bond to the State of South Dakota conditioned upon the prosecution of said appeal and the compliance with the orders and decrees of the court in the premises, and with such surety and in such amount as the court may require. Such notice of appeal shall be signed by the appellant or his attorney and shall be heard upon ten days' notice by either party or upon stipulation between the secretary and the appellant or his attorney.
Source: SDC 1939, § 57.3917; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-51. Relief granted by circuit court--Costs.
The court may grant equitable relief and may order the treasurer to pay the amount of the relief, with interest at the rate of eighteen percent per year to the aggrieved taxpayer. If the appeal was taken without probable cause, the court may double or triple costs as the case may demand. On all appeals which are denied, costs may be taxed against the appellant at the discretion of the court, but no costs may be taxed against the state.
Source: SL 1937, ch 243, § 18; SDC 1939, § 57.3917; SL 1983, ch 28, § 34.
10-50-52. Disposition of proceeds of tax.
The first thirty million dollars in revenue collected annually pursuant to this chapter shall be deposited in the general fund. The next five million dollars in excess of thirty million dollars collected annually shall be deposited in the tobacco prevention and reduction trust fund and shall be used to implement the tobacco prevention and reduction program. All revenue collected pursuant to this chapter in excess of thirty-five million dollars shall be deposited in the general fund.
Source: SDC 1939, § 57.3918; SL 1959, ch 442, § 2; SL 1965, ch 293, § 3; SL 1969, ch 271, § 4; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; Initiated Measure 2, approved Nov. 7, 2006, eff. Jan. 1, 2007; SL 2007, ch 27, § 3; SL 2015, ch 39, § 6.
10-50-58. Cigarette stamp purchasing fund established.
There is established in the state treasury a special revenue fund to be known as the cigarette stamp purchasing fund.
Source: SL 1994, ch 102, § 1.
10-50-59. Recovery of cigarette stamp costs--Deposit of funds.
In addition to the taxes and fees imposed by this chapter, the secretary of revenue may recover the cost of any stamps or other indicia that are required to be affixed to packages of cigarettes from those licensees affixing said stamps or indicia. The amount so recovered shall be deposited into the cigarette stamp purchasing fund and all money in the fund is continuously appropriated to the Department of Revenue to be used to purchase stamps or other indicia.
Source: SL 1994, ch 102, § 2; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-60. Promulgation of rules.
The secretary of revenue may promulgate rules pursuant to chapter 1-26 concerning:
(1) Credit for damaged or unfit cigarette packages;
(2) Refund for unused stamps and other indicia;
(3) The definition of cigarette wholesaler;
(4) Licensing, including bonding and filing license applications;
(5) The filing of returns and payment of tax;
(6) Determining the application of the tax and exemptions;
(7) Taxpayer record-keeping requirements; and
(8) Determining auditing methods.
Source: SL 1995, ch 53, § 8; SL 1995, ch 72, § 14; SL 2003, ch 272 (Ex. Ord. 03-1), § 82; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-61. Wholesale tax on tobacco products--Credit for tax paid.
In addition to the tax imposed by § 10-50-3, there is imposed, whether or not a sale occurs, a tax upon all tobacco products in this state and upon any person engaged in business as a licensed distributor or licensed wholesaler thereof, at the rate of thirty-five percent of the wholesale purchase price of such tobacco products. Such tax shall be imposed at the time the distributor or wholesaler brings or causes to be brought into this state tobacco products for sale; makes, manufactures, or fabricates tobacco products in this state for sale in this state; or ships or transports tobacco products to dealers in this state to be sold by those dealers. For the purposes of this chapter, wholesale purchase price is the price for which a manufacturer sells tobacco products to a licensed distributor or licensed wholesaler exclusive of any discount or other reduction.
Any licensed distributor or licensed wholesaler who has paid tax pursuant to this section and subsequently sells the tobacco products to another licensed distributor or licensed wholesaler for resale, or sells the tobacco products outside of this state, shall receive a credit for the tax paid pursuant to this section on such tobacco products.
Source: SL 1995, ch 72, § 2; Initiated Measure 2 approved Nov. 7, 2006, eff. Jan. 1, 2007; SL 2014, ch 65, § 4.
10-50-62. Dealers to buy only from licensed wholesalers and distributors who have paid taxes--Violation as misdemeanor.
Tobacco dealers may purchase tobacco products and cigarettes only from wholesalers and distributors licensed by the State of South Dakota who have paid all taxes as required by this chapter on the tobacco products or cigarettes sold to the dealer. A violation of this section is a Class 2 misdemeanor.
Source: SL 1995, ch 72, § 3; SL 2007, ch 64, § 6; SL 2014, ch 65, § 5.
10-50-63. Deadline for reporting and remitting wholesale tobacco tax--Penalty--Credit or refund for destroyed unfit tobacco.
On or before the fifteenth day of each calendar month, each person required to pay the tax imposed by § 10-50-61 shall report, on forms prescribed by the secretary, the amount and type of tobacco products manufactured or brought into this state during the month preceding the month in which the report is made, the source of those tobacco products, and the wholesale purchase price of those tobacco products. The person shall remit the tax due on those tobacco products with the filing of the form. Any person who fails to timely file the form and pay the tax in this section may be subject to penalty and interest as prescribed in § 10-59-6. Any person seeking to recover overpayment of the tax imposed in § 10-50-61, may do so in the manner prescribed in §§ 10-59-19, 10-59-20, 10-59-21, 10-59-22, 10-59-23, and 10-59-24. The secretary may secure the payment of any unpaid tax in the same manner as prescribed in chapter 10-59. If any taxpayer destroys tobacco products upon which the tax imposed by § 10-50-61 or 10-50-62 has been paid because of unfitness for sale, a credit or refund in the amount of the tax paid on those products shall be granted as prescribed in this section for the overpayment of tax.
Source: SL 1995, ch 72, § 4; SL 1996, ch 91.
10-50-64. Voluntary regulation of use of tobacco products.
The Legislature is the exclusive regulator of all matters relating to the use of tobacco products. Nothing prohibits a person or a public entity from voluntarily regulating the use of tobacco products on the person's or entity's property.
Source: SL 1995, ch 72, § 15.
10-50-65. Certain activities regarding for-export-only tobacco products prohibited--Violation as misdeameanor.
No dealer, licensed distributor, licensed wholesaler, or any other person in this state may acquire, import, hold, own, possess, sell, or distribute or transport for sale or distribution:
(1) Any cigarettes or tobacco products intended for export or previously exported from the United States;
(2) Any cigarettes or tobacco products, the package of which bears any statement, label, stamp, sticker, or notice indicating that the manufacturer did not intend the cigarettes or tobacco products to be sold, distributed, or used in the United States, including labels stating, For Export Only, U.S. Tax-Exempt, For Use Outside U.S., or similar wording; or
(3) Any cigarettes or tobacco products that the person knows or has reason to know the manufacturer did not intend to be sold, distributed, or used in the United States.
A violation of this section is a Class 1 misdemeanor.
Source: SL 2000, ch 65, § 1.
10-50-66. Seizure and destruction of contraband tobacco products.
Any cigarettes or tobacco products found at any place in this state that have been imported in violation of §§ 10-50-65 to 10-50-67, inclusive, are declared to be contraband goods and may be seized without a warrant by the secretary, agents or employees of the secretary, or any law enforcement officer of this state when directed to do so by the secretary. Cigarettes or tobacco products imported in violation of §§ 10-50-65 to 10-50-67, inclusive, shall be destroyed by the secretary.
Source: SL 2000, ch 65, § 2; SL 2019, ch 66, § 2.
10-50-67. Relief for violation of § 10-50-65.
In addition to any other remedy provided by law, any person may bring an action for appropriate injunctive or other equitable relief for a violation of § 10-50-65; actual damages, if any, from the distributor, wholesaler, or other violator sustained by reason of the violation; and, as determined by the court, interest on the damages from the date of the complaint, taxable costs, and reasonable attorney's fees. If the trier of fact finds that the violation is flagrant, it may increase recovery to an amount not in excess of three times the actual damages sustained by reason of the violation.
Source: SL 2000, ch 65, § 3.
10-50-72. Definition of terms.
Terms used in §§ 10-50-72 to 10-50-92, inclusive, mean:
(1) "Brand family," all styles of cigarettes sold under the same trade mark and differentiated from one another by means of additional modifiers or descriptors, including menthol, lights, kings, and 100s and any brand name (alone or in conjunction with any other word), trademark, logo, symbol, motto, selling message, recognizable pattern of colors, or any other indicia of product identification identical, similar to, or identifiable with a previously known brand of cigarettes;
(2) "Cigarette," the same meaning as in § 10-50B-4;
(3) "Master Settlement Agreement," the same meaning as in subdivision 10-50B-3(4);
(4) "Nonparticipating manufacturer," any tobacco product manufacturer that is not a participating manufacturer;
(5) "Participating manufacturer," the same meaning as that term is defined in section II(jj) of the Master Settlement Agreement as of January 1, 2003;
(6) "Qualified escrow fund," the same meaning as in subdivision 10-50B-3(5);
(7) "Tobacco product manufacturer," the same meaning as in § 10-50B-5; and
(8) "Units sold," the same meaning as in § 10-50B-6.
Source: SL 2003, ch 74, § 1.
10-50-73. Manufacturer to certify participation or compliance--Form--Delivery--Contents.
Any tobacco product manufacturer whose cigarettes are sold in this state whether directly or through a distributor, wholesaler, retailer, or similar intermediary or intermediaries shall execute and deliver a certification that, as of the date certified, the tobacco product manufacturer is either a participating manufacturer or is in full compliance with chapter 10-50B. The certification shall be made on a form prescribed by the secretary and delivered to the secretary no later than the thirtieth day of April of each year. A participating manufacturer shall include in its certification a list of its brand families. A nonparticipating manufacturer shall include in its certification:
(1) A complete list of all of its brand families that separately lists brand families of cigarettes and the units sold for each brand family in the state during the preceding calendar year, indicating by an asterisk any brand family sold in the state during that year that is no longer being sold in the state as of the date of the certification, and identification by name and address of any other manufacturer of listed brand families in that year and the current calendar year, and all of its brand families that have been sold in the state at any time during the current calendar year;
(2) That the nonparticipating manufacturer is registered to do business in the state or has appointed a resident agent for service of process and provided notice thereof as required by § 10-50-83;
(3) That the nonparticipating manufacturer has established and continues to maintain a qualified escrow fund, and has executed a qualified escrow agreement governing the qualified escrow fund that has been reviewed and approved by the attorney general;
(4) That the nonparticipating manufacturer is in full compliance with chapter 10-50B, §§ 10-50-72 to 10-50-92, inclusive, and any rules promulgated pursuant thereto;
(5) The name, address, and telephone number of the financial institution where the nonparticipating manufacturer has established the qualified escrow fund, the account number of the qualified escrow fund and sub-account number for the state, the amount the nonparticipating manufacturer placed in the fund for cigarettes sold in the state during the preceding calendar year, the date, and amount of each deposit, the amount and date of any withdrawal or transfer of funds the nonparticipating manufacturer made at any time from the fund, or from any other qualified escrow fund into which it ever made escrow payments, and such evidence or verification as may be deemed necessary by the secretary to confirm the foregoing; and
(6) That the nonparticipating manufacturer consents to be sued in the circuit courts of the state for purposes of the secretary enforcing any provision of chapter 10-50B, §§ 10-50-72 to 10-50-92, inclusive, and any rules promulgated pursuant thereto. The consent to suit shall be demonstrated by the execution and submission of a consent to suit form prepared by the attorney general, with proof of authority to consent and execute the form.
Source: SL 2003, ch 74, § 2; SL 2005, ch 83, § 1.
10-50-74. Certification update--Supplemental certification.
A tobacco product manufacturer shall update the brand families list included in its certification thirty days prior to any addition to or modification of its brand families by executing and delivering to the secretary a supplemental certification.
Source: SL 2003, ch 74, § 3.
10-50-75. Inclusion of brand families--Requirements--No limitation on rights of State.
A tobacco product manufacturer may not include a brand family in its certification unless:
(1) In the case of a participating manufacturer, the participating manufacturer affirms that the brand family is to be deemed its cigarettes for purposes of calculating its payments under the Master Settlement Agreement for the relevant year in the volume and shares determined pursuant to the Master Settlement Agreement; and
(2) In the case of a nonparticipating manufacturer, the nonparticipating manufacturer affirms that the brand family is to be deemed its cigarettes for purposes of chapter 10-50B.
Nothing in this section limits or otherwise affects the state's right to maintain that a brand family constitutes cigarettes of a different tobacco product manufacturer for purposes of calculating payments under the Master Settlement Agreement or for the purposes of chapter 10-50B.
Source: SL 2003, ch 74, § 4.
10-50-76. Maintenance of records--Exception.
Each tobacco product manufacturer shall maintain all invoices and documentation of sales and such other information relied upon for the certification for a period of six years, unless otherwise required by law to be maintained for a greater period of time.
Source: SL 2003, ch 74, § 5.
10-50-77. Annual publication of directory on internet website--Date of publication--Development, contents and maintenance.
The secretary shall annually develop and publish on the Department of Revenue's internet website no later than May fifteenth of each year, a directory listing all tobacco product manufacturers that have provided current and accurate certifications conforming to the requirements of §§ 10-50-72 to 10-50-92, inclusive, and all brand families that are listed in the certifications except as provided in § 10-50-78. The secretary shall update the directory as necessary in order to correct mistakes and to add or remove a tobacco product manufacturer or brand families to keep the directory in conformity with the requirements of §§ 10-50-72 to 10-50-92, inclusive. The attorney general shall, if requested by the secretary, assist in the development and maintenance of the directory.
Source: SL 2003, ch 74, § 6; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-78. Exclusion from directory--Cure.
The secretary may not include or retain in the directory the name or brand families of any nonparticipating manufacturer that fails to provide the required certification or whose certification the secretary determines is not in compliance with §§ 10-50-72 to 10-50-92, inclusive, unless the noncompliance has been cured to the satisfaction of the secretary. No nonparticipating manufacturer or brand family may be included or retained in the directory if the secretary concludes that:
(1) Any escrow payment required pursuant to chapter 10-50B for any period for any brand family, whether or not listed by the nonparticipating manufacturer, has not been fully paid into a qualified escrow fund governed by a qualified escrow agreement that has been approved by the attorney general; or
(2) Any outstanding final judgment, including interest thereon, for violations of chapter 10-50B has not been fully satisfied for the brand family or the manufacturer.
Source: SL 2003, ch 74, § 7.
10-50-79. Hearing and appeal.
Any tobacco product manufacturer excluded or removed from the directory may request a contested case hearing before the secretary. A request for hearing shall be made within sixty days of the manufacturer's exclusion or removal from the directory, and shall contain the evidence supporting the manufacturer's compliance with chapter 10-50B and §§ 10-50-72 to 10-50-92, inclusive. At the hearing, the secretary shall determine whether the tobacco product manufacturer is in compliance with chapter 10-50B and §§ 10-50-72 to 10-50-92, inclusive, and whether the manufacturer should be listed in the directory. Any decision of the secretary may be appealed to the circuit court as provided by chapter 1-26.
Source: SL 2003, ch 74, § 8.
10-50-80. Distributors and wholesalers to submit information to secretary--Maintenance and availability of records--Monetary penalty--Deposit in general fund.
No later than twenty days after the end of each calendar quarter, and more frequently if so directed by the secretary, each distributor and wholesaler shall submit information concerning each nonparticipating manufacturer as the secretary requires to facilitate compliance with §§ 10-50-72 to 10-50-92, inclusive, including, a list by brand family of the total number of cigarettes or, in the case of roll-your-own, the equivalent stick count, for which the distributor or wholesaler affixed cigarette tax stamps to a cigarette package, or otherwise paid the cigarette tax due during the previous calendar quarter. The distributor or wholesaler shall maintain and make available to the secretary all invoices and documentation 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.
Source: SL 2003, ch 74, § 9; SL 2005, ch 84, § 1; SL 2007, ch 66, § 13.
10-50-81. Secretary may require additional information.
In addition to the information required to be submitted pursuant to §§ 10-50-72 to 10-50-92, inclusive, the secretary may require a distributor, wholesaler, or tobacco product manufacturer to submit information, including samples of the packaging or labeling of each brand family, as necessary to determine whether a tobacco product manufacturer, distributor, or wholesaler is in compliance with §§ 10-50-72 to 10-50-92, inclusive.
Source: SL 2003, ch 74, § 10.
10-50-82. Inclusion in directory prerequisite to affixing tax stamp or distribution--Monetary penalty--Deposit in general fund.
No distributor or wholesaler or other person may:
(1) Affix a South Dakota cigarette tax stamp to a package or other container of cigarettes, or pay South Dakota cigarette tax on cigarettes of a tobacco product manufacturer or brand family not included in the directory; or
(2) Sell or distribute, or acquire, hold, own, possess, transport, import, or cause to be imported, cigarettes of a tobacco product manufacturer or brand family not included in the directory that the distributor, wholesaler, or other person knows or should know are intended for distribution or sale in this state.
The secretary may, in addition to any other provision of law, impose and collect a monetary penalty in an amount not to exceed the greater of five hundred percent of the retail value of the cigarettes or five thousand dollars for each violation of this section by a distributor or wholesaler. Any monetary penalty collected pursuant to this section shall be deposited in the state general fund.
Source: SL 2003, ch 74, § 11; SL 2005, ch 84, § 2; SL 2007, ch 66, § 14.
10-50-83. Inclusion of unregistered nonresident or foreign manufacturers in directory--Service of process--Information to be provided to secretary.
Any nonresident or foreign nonparticipating manufacturer that has not registered to do business in the state as a foreign corporation or business entity shall, as a condition precedent to having its brand families listed or retained in the directory, appoint and continually engage without interruption the services of an agent in the United States to act as agent for the service of process upon whom all process, and any action or proceeding against it concerning or arising out of the enforcement of §§ 10-50-72 to 10-50-92, inclusive, and chapter 10-50B, may be served in any manner authorized by law. Service under this section constitutes legal and valid service of process on the nonparticipating manufacturer. The nonparticipating manufacturer shall provide the name, address, phone number, and proof of the appointment and availability of the agent to, and to the satisfaction of, the secretary.
Source: SL 2003, ch 74, § 12.
10-50-84. Notice to secretary of agent's authority--Termination or appointment of agent.
A nonparticipating manufacturer shall provide notice to the secretary thirty calendar days prior to termination of the authority of an agent established by § 10-50-83 and shall further provide proof to the satisfaction of the secretary of the appointment of a new agent no less than five calendar days prior to the termination of an existing agent appointment. If an agent terminates an agency appointment, the nonparticipating manufacturer shall notify the secretary of the termination within five calendar days and shall include proof to the satisfaction of the secretary of the appointment of a new agent.
Source: SL 2003, ch 74, § 13.
10-50-85. Service upon secretary of state in lieu of appointed or designated agent--Such service does not constitute compliance.
Any nonparticipating manufacturer whose products are sold in this state without appointing or designating an agent as required by §§ 10-50-72 to 10-50-92, inclusive, shall be deemed to have appointed the secretary of state as its agent and may be proceeded against in courts of this state by service of process upon the secretary of state. However, the appointment of the secretary of state as its agent does not constitute compliance for the purpose of having a nonparticipating manufacturer or its brand families listed or retained in the directory.
Source: SL 2003, ch 74, § 14.
10-50-86. Disclosure of information to attorney general--Inter-agency sharing of information.
The secretary may disclose to the attorney general any information received under §§ 10-50-72 to 10-50-92, inclusive, and requested by the attorney general for purposes of determining compliance with and enforcing the provisions of §§ 10-50-72 to 10-50-92, inclusive, and chapter 10-50B. The secretary and attorney general shall share with each other the information received under §§ 10-50-72 to 10-50-92, inclusive, and may share such information with other federal, state, or local agencies only for purposes of enforcement of §§ 10-50-72 to 10-50-92, inclusive, chapter 10-50B, or corresponding laws of other states.
Source: SL 2003, ch 74, § 15.
10-50-87. Financial information to be made available to attorney general.
The attorney general may require a nonparticipating manufacturer to provide proof from the financial institution in which the manufacturer has established a qualified escrow fund for the purpose of compliance with chapter 10-50B, of the amount of money in the fund being held in escrow, the dates of deposits, and a listing of the amounts of all withdrawals from the fund and the dates thereof.
Source: SL 2003, ch 74, § 16.
10-50-88. Declaration of contraband--Seizure, forfeiture and destruction.
Any cigarettes that have been sold, offered for sale, or possessed for sale in violation of §§ 10-50-72 to 10-50-92, inclusive, are contraband goods and may be legally seized, without a warrant, by the secretary, the secretary's agents or employees, or by any law enforcement officer of this state if directed by the secretary to do so. Any cigarettes seized and forfeited under this section shall be destroyed.
Source: SL 2003, ch 74, § 17.
10-50-89. Promulgation of rules--Certification, reporting and directory.
The secretary, for purposes of §§ 10-50-72 to 10-50-92, inclusive, may promulgate rules pursuant to chapter 1-26 concerning the procedures, forms, and contents for:
(1) The certification process for tobacco product manufacturers;
(2) The reporting requirements for distributors and wholesalers; and
(3) The directory of tobacco product manufacturers that have complied with the requirements of §§ 10-50-72 to 10-50-92, inclusive.
Source: SL 2003, ch 74, § 18.
10-50-90. Attorney general may seek restraining order--Action for enforcement--Compensation for costs.
The attorney general may seek an injunction to restrain a threatened or actual violation of §§ 10-50-72 to 10-50-92, inclusive. In any action brought by the state to enforce the provisions of §§ 10-50-72 to 10-50-92, inclusive, the court shall award the state the recovery of its expert witness fees, costs, and reasonable attorney fees.
Source: SL 2003, ch 74, § 19.
10-50-91. Schedule of reports--Publication--Pre-publication sales, distribution, etc.
The first report required of a distributor or wholesaler under §§ 10-50-72 to 10-50-92, inclusive, is due July 15, 2003, the tobacco product manufacturer certifications required under §§ 10-50-72 to 10-50-92, inclusive, are due August 15, 2003, and the secretary shall have the directory published on the Department of Revenue's internet website required under §§ 10-50-72 to 10-50-92, inclusive, no later than September 30, 2003. Until the secretary publishes the directory pursuant to this section, the cigarettes of any participating manufacturer and of any nonparticipating manufacturer included on the directory published by the secretary under § 10-50-69 as it exists on June 30, 2003, may be sold, distributed, acquired, held, owned, possessed, transported, imported, or caused to be imported in this state.
Source: SL 2003, ch 74, § 20; SL 2011, ch 1 (Ex. Ord. 11-1), § 161, eff. Apr. 12, 2011.
10-50-92. Conflict with other law.
If a court of competent jurisdiction finds that the provisions of §§ 10-50-72 to 10-50-92, inclusive, and of chapter 10-50B conflict and cannot be harmonized, then the provisions of chapter 10-50B shall control. If any provision of §§ 10-50-72 to 10-50-92, inclusive, causes chapter 10-50B to no longer constitute a qualifying or model statute, as those terms are defined in the Master Settlement Agreement, then that portion of §§ 10-50-72 to 10-50-92, inclusive, is not valid.
Source: SL 2003, ch 74, § 21.
10-50-99. Shipment or transportation of cigarettes and tobacco products to consumers by sellers or distributors prohibited.
No person who is engaged in the business of selling or distributing cigarettes or tobacco products may ship or transport, or cause to be shipped or transported, cigarettes or tobacco products to any consumer in the state. This section applies regardless of whether the person engaged in the business of selling or distributing cigarettes or tobacco products is located within or without the state.
Source: SL 2009, ch 58, § 8.
10-50-100. Injunction for actual or threatened violation.
The attorney general may seek an injunction to restrain a threatened or actual violation of § 10-50-99.
Source: SL 2009, ch 58, § 9.
10-50-101. Civil action for violation--Civil penalty.
The attorney general may bring a civil action in circuit court for any violation of § 10-50-99. In a civil action, in addition to injunctive or any other relief, the court may impose a civil penalty, for a first violation of § 10-50-99, in the amount of one thousand dollars or five times the retail value of the cigarettes or tobacco products involved, whichever is greater. A subsequent violation of § 10-50-99 is punishable by a civil penalty of five thousand dollars or five times the retail value of the cigarettes or tobacco products involved, whichever is greater.
Source: SL 2009, ch 58, § 10.
10-50-102. Separate violations.
Each shipment, transport, or attempted shipment or transport, of cigarettes or tobacco products in violation of § 10-50-99 constitutes a separate violation.
Source: SL 2009, ch 58, § 11.
10-50-103. Forfeiture of products, profits, and benefits.
Any cigarettes or tobacco products shipped, transported, or attempted to be shipped or transported, in violation of § 10-50-99 shall be forfeited to the state and destroyed. In addition, any profit, gain, gross receipt, or other benefit from the violation of § 10-50-99 shall be disgorged and paid to the state treasurer for deposit in the state's general fund.
Source: SL 2009, ch 58, § 12.
10-50-104. Other available penalties and remedies--Tax collected from person receiving products.
Unless otherwise expressly provided, the penalties or remedies, or both, under §§ 10-50-100 to 10-50-103, inclusive, are in addition to any other penalties and remedies available under any other law of the state. Nothing in §§ 10-50-99 to 10-50-103, inclusive, prohibits the collection of tax against a person receiving cigarettes or tobacco products in violation of this chapter.
Source: SL 2009, ch 58, § 13.
10-50-105. Provider of roll-your-own machine is cigarette manufacturer--Exception.
Any person that maintains or provides a machine that enables any consumer to process tobacco or any product that is made or derived from tobacco into a roll or tube is deemed to be a manufacturer of cigarettes. This includes a person who owns or possesses an automated roll-your-own machine that is used to make cigarettes, but does not include a person who owns or possesses a roll-your-own machine and uses the machine in the person's residence solely to make cigarettes for his or her own personal use or for the personal use of other individuals who reside at the residence.
The product produced by a roll-your-own machine as described in this section is deemed to be a cigarette that was sold to a consumer for purposes of this chapter and chapter 10-50B. The product produced by the machine shall comply with the provisions of chapter 34-49 by July 1, 2014.
Source: SL 2012, ch 74, § 1; SL 2014, ch 65, § 6.
10-50-106. Only products in directory to be used in roll-your-own machine.
Only tobacco products that are included in the directory published pursuant to § 10-50-77 may be inserted into a roll-your-own machine as described in § 10-50-105.
Source: SL 2014, ch 65, § 7.
10-50-107. Seizure and destruction of tobacco products not purchased from licensed distributor or wholesaler.
Any tobacco products found at any place in this state that were purchased from any person other than a licensed distributor or licensed wholesaler, and that have not had the proper tax paid pursuant to § 10-50-61, are declared to be contraband goods and may be seized by the secretary, the secretary's agents or employees, or by any law enforcement of this state if directed by the secretary to do so, without a warrant. Any tobacco products seized pursuant to this section shall be forfeited to the state and destroyed.
Source: SL 2014, ch 65, § 8.
