ARSD § 64:06:03:24 — Items consumed in a manufacturing process

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64:06:03:24. Items consumed in a manufacturing process.
Gross receipts from sales to manufacturers, producers, or processors, including
flour mills, bakeries, or creameries, any product transferred electronically,
of tangible personal property of any kind, including gas, fuel, electricity,
tools, and other property which is used by such manufacturers in the
manufacturing process and which does not become an ingredient or component part
of the tangible personal property manufactured, produced, or processed, are
taxable. The manufacturer, producer, or processor is the final buyer or
ultimate consumer of the tangible personal property and does not purchase it
for resale. The tangible personal property and any product transferred
electronically so purchased is not purchased by the
manufacturer for the purpose of resale but for the operation of the business.
If sales tax is not paid to a licensed South Dakota supplier, use tax must be
paid to the state.
A business is liable for use tax on
all items of tangible personal property and any product transferred
electronically used by the business even though an item may have been
especially fabricated to produce a product for a particular customer, is
completely consumed in completing the customer's order, and the cost of the
item is included in the charge to the customer.