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South Dakota Outlaws Tax Zappers

  • Mar 23, 2016 | Gail Cole

 Boom, Pow, Zap - sales tax suppression devices outlawed in South Dakota.

Sales tax suppression devices enable businesses to falsify sales records and transaction reports, thereby remitting less sales tax than collected. If this seems like a type of device that should be illegal, it is—at least in numerous states. And effective March 10, 2016, the use of tax zappers is against the law in South Dakota.

Newly enacted House Bill 1051 prohibits the use of certain automated sales suppression devices and provides penalties for their use. Under the bill, it is a Class 5 felony to “knowingly own, sell, rent, lease, purchase, install, transfer, possess, use, access, design, manufacture, or program any automated sales suppression device or phantom-ware.”

Anyone convicted of a violation of this new law is, in addition to civil and/or criminal penalties, liable for all sales and use tax, contractor’s excise tax, and any other tax imposed by title 10.

South Dakota is in good company. Connecticut, Kentucky, and North Carolina are among the many states that have banned the use of tax zappers.

Instead of trying to avoid sales and use tax, businesses should automate sales and use tax compliance. Learn more.

photo credit: Boom, Pow, Zap via photopin (license)

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.