South Dakota Administrative Rules
Title 64 - REVENUE
Article 64:06 - Sales tax
Chapter 64:06:02 - Services - Interpretive rules
Section 64:06:02:75 - Lodging establishments

Sales of supplies and equipment to a lodging establishment are taxable. Lodging establishments are the consumers of supplies and equipment which are consumed or used by them in rendering their services. If the sales tax on such items is not paid to a South Dakota licensed supplier when they are purchased, the cost of such items must be reported as a use tax item on the sales tax return. Examples of such items include paper cups, plastic cups, laundry bags, soap, shower caps, toilet tissue, facial tissue, shoe polish, toilet bands, stationary, consumables and refreshments provided as a convenience to the guest, cleaning products, and other items consumed on the premises by the lodging establishment.

Charges to a lodging establishment by a laundry, linen, or towel supply company are taxable. A lodging establishment does not retail such items but purchases them or uses the services for the purpose of providing sleeping accommodations.

Laundry and dry cleaning establishments must report tax on their charges for services to hotel, motel, or tourist home guests even though payment is received from the hotel, motel, or tourist home. Hotels, motels, and tourist homes are considered agents for laundry and dry cleaning establishments and do not report tax to the department on receipts which are collected for a laundry or dry cleaner.

General Authority: SDCL 10-45-47.1(3), 10-45D-13(3), 10-46-35.1(3), 10-52A-7(3).

Law Implemented: SDCL 10-45-2, 10-45-7, 10-45D-2, 10-46-2, 10-52A-2.

Declaratory Ruling: Rental of boat slips for more than 28 days, where the lessor provides a night guard, gasoline service, towing service, and a check-in system for boat owners, is the providing of a service rather than the rental of tangible personal property, and, as such, is subject to the sales tax. Secretary of Revenue Declaratory Ruling No. 80-9.