April 28, 1988

The Honorable Leonard Andera 
Andera Law Offices 
P.O. Box 286 
Chamberlain, South Dakota 57325

Official Opinion No. 88-14

Sales Taxation of Baby Game Birds

Dear Senator Andera:

You have requested an official opinion on the question of whether the initial sale of baby game birds by private individuals in South Dakota is subject to South Dakota sales tax.  In this connection, you have pointed out a number of  laws which relate to the nature of wild animals in certain instances as the property of the state, SDCL 41-1-2;  animals wild by nature which may be tamed or taken and held in possession or disabled, SDCL 43-2-3 and the section which provides that all game not marked as required for use on a shooting preserve shall be deemed wild game, SDCL 41-10-10.

These statutes define and relate to matters which are under the direction and control of the Game, Fish and Parks Department, and identify types of ownership of property.  They do not, in my opinion, however, relate to the tax laws of the state nor the authority of the legislature under Article XI, Section 2 of the Constitution to impose various types of taxes.  Neither do they address the Legislature's authority to declare what property shall be subject to taxation and which may be exempt.  State ex rel. Botkin v. Welch, 61 S.D. 593, 251 N.W. 189 (1933).

You have also called my attention to the provisions of SDCL 10‑46‑16 which provides that gross receipts from the sale of livestock or poultry are not taxable under the use tax law when those sales are a part of a series of transactions incident to producing a finished product intended to be offered for an ultimate retail sale.  Retail sale is defined as the sale of tangible personal property or services to the consumer or user thereof or to any person for any purpose other than for resale, SDCL 10-45-1(5).

The question under this section, which is the only statute arguably providing  an exemption, is whether baby game birds that are acquired by a person licensed under SDCL 41-10 are being "sold" to the guests of the licensee.  The game preserve operator, within limitations prescribed by the Game, Fish and Parks Commission, may set his own shooting limitations and restrictions, establish his own hours, bag limits and fees to be charged to his guests, SDCL 41-10-14.

It is my opinion that a game preserve operator is not selling game per se but is offering to his guests, on such terms and conditions as he may prescribe, the right to enter upon and hunt game within the preserve.  The guest may then harvest and legally possess pen raised or wild game shot on the shooting preserve if the game is tagged as directed by the Game, Fish and Parks Commission, SDCL 41-10-16.  Even as to pen raised birds, the shooting preserve operator offers much more (e.g. hunting opportunity, land on which to hunt, extended seasons) than bird meat.  The harvesting of pen raised birds is thus not a retail sale of the birds or their meat.

It also can not be argued that the preserve operator is selling wild game to the hunter, since, as you point out, the ownership of wild game is in the state for the benefit of its inhabitants.  State v. Kemp, 73 S.D. 458, 44 N.W.2d 214 (1949).  This was further discussed in the case of State v. Pollock, 42 S.D. 360, 175 N.W. 557 (1919) and pointing out that: 

[t]he ownership of game being in the first instance lodged in the people of  the state, may be reserved to them, or they may permit individuals to acquire title to such as are reduced to possession.  Any ownership which an individual is allowed to acquire may be subject to such conditions and limitations as the people acting through their legislative agents, may wish to impose.

This rule is also in § 41-1-3 which permits the taking and keeping of game as provided by law or regulation prescribed by the Game, Fish and Parks Commission.

I find no conflict in the sections relating to wild animals as opposed to those animals on the preserve, and no intention expressed by the legislature that such game is intended by those sections to be exempt from sales taxation.

There being no applicable exemption, the sale of baby game birds is subject to sales taxation.

Respectfully submitted,

Roger A. Tellinghuisen
Attorney General