STATE OF SOUTH DAKOTA
OFFICE OF
THE ATTORNEY GENERAL

August 26, 1975

Mr. Jay Tapken
State's Attorney
Hutchinson County Courthouse
Olivet, South Dakota 57052

OFFICIAL OPINION NO. 75-148

Purchasing of gasoline by school district for contracting school bus company to avoid fuel tax

Dear Mr. Tapken:

You have requested an official opinion on the following question:

Can a school district purchase gasoline, and then can the contracting school bus company reimburse the school district for the gasoline, thereby saving the gasoline tax which the school district incurs?

The tax on motor vehicle fuel imposed by SDCL 10-47-2 applies to gasoline used by the school district as well as by the contracting bus company. Since the school district is not exempt from payment of this tax, neither the school district nor the contractor will gain anything by the proposed plan.

In 1947-1948 AGR 195, the question of the liability of local government for payment of the motor fuel tax was discussed at some length. Reference was made, in this opinion, to the cases of State v. City of Sioux Falls, 60 S.D. 330,224 N.W. 365, and City of Pierre v. Stout, 65 S.D. 597, 276 N.W. 922, which support the contention that:

The state and its political subdivisions are liable for excise taxes unless exempted therefrom.

The answer to your question therefore, is NO.

Respectfully submitted,

William Janklow
Attorney General

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