Monday, June 9, 2014

All Air Transportation Services are Not Subject to South Dakota Sales or Use Tax

Effective immediately all air transportation services are not subject to South Dakota sales or use tax.
The Department of Revenue has determined that the Federal Anti-Head Tax Act (49 United States Code § 40116) of 1973 exempts gross receipts  received for intrastate and interstate air transportation services from South Dakota sales tax.  Your business is still responsible for sales or use tax on the sale of any taxable product or service.

Your business may be affected if you provide any of the following services:
  • Aerial sightseeing services (i.e., airplane, helicopter, balloon, dirigible and blimp rides.
  • Air transportation services
  • Air Ambulance services
  • Any air transportation service in Federal Airways
Air transportation services provided with other taxable services for one non-itemized charge are taxable.

For example: Sky diving lessons are subject to sales tax.
  • If there is a single charge for the lessons and flight, the entire charge is taxable. 
  • If the charge for the lessons and flight are separately stated, the charge for the lessons are taxable and the charge for the flight is exempt.            

 Our agents are available to assist you with any questions you may have.  You may contact the Department at 1-800-829-9188 or you may visit one of our field offices located in Aberdeen, Watertown, Sioux Falls, Yankton, Mitchell, Rapid City or Pierre.