South Dakota Codified Laws 10-46-5. Contractors and subcontractors taxed on property used in performance of contract–Fabrication costs excluded
If a contractor or subcontractor, as defined in chapters 10-46A and 10-46B, uses tangible personal property or any product transferred electronically in the performance of a contract or to fulfill contract or subcontract obligations, whether the title to the property is in the name of the contractor, subcontractor, contractee, subcontractee, or any other person, or whether the titleholder of the property would be subject to pay the sales or use tax, the contractor or subcontractor shall pay a tax at the rate prescribed by § 10-45-2, measured by the purchase price or fair market value of the property, whichever is greater, unless the property has been previously subjected to a sales or use tax, in this state and the tax due thereon has been paid. However, if the contractor or subcontractor fabricates tangible personal property for use in the performance of a contract, fair market value excludes the value of the contractor’s or subcontractor’s fabrication costs.
Terms Used In South Dakota Codified Laws 10-46-5
- Contract: A legal written agreement that becomes binding when signed.
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- Person: includes natural persons, partnerships, associations, cooperative corporations, limited liability companies, and corporations. See South Dakota Codified Laws 2-14-2
- Personal property: includes money, goods, chattels, things in action, and evidences of debt. See South Dakota Codified Laws 2-14-2
- Personal property: All property that is not real property.
- Property: includes property, real and personal. See South Dakota Codified Laws 2-14-2
Source: SDC Supp 1960, § 57.4303 (4) as added by SL 1966, ch 256; SL 1977, ch 99, § 2; SL 1982, ch 118, § 1; SL 1992, ch 91, § 1; SL 2008, ch 51, § 41.