The Sioux Falls Tax Rate, Line by Line
Sioux Falls is the state's busiest retail market, drawing shoppers and diners from South Dakota, Minnesota, Iowa and Nebraska. That makes getting the local rate right important for any business selling there. The Department of Revenue collects the city's taxes on the same return as the state tax, but each one is reported on its own line with its own code. BOMCAS helps Sioux Falls businesses set the right rates in their systems, file accurate returns and keep records that hold up in an audit.
Licensing, taxable services and remote seller rules work the same everywhere in the state, as our South Dakota sales and use tax guide explains. Below are the rates and situations specific to Sioux Falls.
What a Sale in Sioux Falls Carries
Based on the Department of Revenue's municipal tax guide for July 2026:
- General sales: 4.2 percent state tax plus the 2 percent Sioux Falls municipal sales tax (code 330-2), for 6.2 percent.
- Restaurants, bars, admissions: add the 1 percent Sioux Falls municipal gross receipts tax (code 330-1), for 7.2 percent. In Sioux Falls it applies to alcoholic beverages, eating establishments, lodging, and admissions to places of amusement, athletic and cultural events, such as concerts and games at the Denny Sanford PREMIER Center.
- Hotel and other lodging stays of less than 28 days: 4.2 percent state, 2 percent municipal, 1 percent gross receipts, the 1.5 percent state tourism tax (code 700-1) and the 1 percent Sioux Falls lodging tax (code 800-1), for 9.7 percent of the room charge. The city's code dedicates the lodging tax to Experience Sioux Falls, the city's visitor bureau.
Hotels and motels with 40 or more rooms also fall inside the Experience Sioux Falls business improvement district. They charge guests a $2-per-night occupational tax, which is remitted to the city's finance director by the 20th of each month. It does not go on the Department of Revenue return. Short-term rental hosts and smaller properties should confirm which of these taxes apply to them.
Two Counties, and a Change in 2027
Most of Sioux Falls is in Minnehaha County, but its southern neighbourhoods are in Lincoln County, along with Harrisburg and Tea. Under a 2026 state law, counties can adopt a gross receipts tax of up to 0.5 percent on taxable sales in the county, with the money used for property tax credits on owner-occupied homes. The Department of Revenue has announced that Lincoln County is one of six counties adopting it from January 1, 2027. Minnehaha County is not on that list. Sellers who deliver to Sioux Falls addresses will need to know which county each address is in, and we will confirm the treatment in the department's updated guides when they are published.
The state rate is also scheduled to return from 4.2 percent to 4.5 percent on July 1, 2027. A Sioux Falls restaurant in the Lincoln County part of the city could see its combined rate change twice within six months, so systems and menus need updating both times.
Deliveries and Service Calls Around the Metro
South Dakota taxes a sale where the customer receives it. Items picked up at a Sioux Falls store carry the Sioux Falls rate. Items delivered elsewhere carry the rate at the delivery address. Brandon, Harrisburg, Tea, Hartford, Crooks, Dell Rapids, Baltic, Lennox, Canton and Worthing each have their own 2 percent municipal tax and 1 percent gross receipts tax, while Valley Springs has a 2 percent municipal tax and no gross receipts tax. Rural addresses outside city limits carry no municipal tax at all. Deliveries into Minnesota or Iowa are not subject to South Dakota tax, but they may be taxable in that state. Repair services are taxed where the repaired item is delivered back to the customer. Furniture stores, appliance dealers, landscapers and contractors who work across the metro need address-based rates, not a single city rate.
Services Are Taxable in Sioux Falls
Many Sioux Falls service businesses that would not charge tax in Minnesota or Iowa must charge it here: salons and spas, auto repair, cleaning, pest control, landscaping, photography, marketing, IT support and many business services. Health services, which make up much of the local economy, are exempt, but products sold by clinics, such as retail eyewear or supplements, may not be. Construction services are covered by contractor's excise tax instead. We review each revenue line before you register so the license and the rate settings are right from the start.
Vendors, Events and Mobile Food
The city licenses peddlers and mobile food vendors. A mobile food vendor licence costs $75 a year, expires December 31, and requires a valid South Dakota sales tax number, health and fire inspections, and proof of insurance. Vendors at farmers markets, craft shows and events in Sioux Falls still collect state and city sales tax, and food vendors also collect the gross receipts tax. We help new vendors register with the Department of Revenue before applying to the city.
Use Tax for Sioux Falls Businesses
When a Sioux Falls business buys taxable goods or services from a vendor who does not charge South Dakota tax, such as an out-of-state software provider or a Minnesota supplier, it owes use tax at the state rate plus the Sioux Falls municipal rate. We review purchases each month and add use tax to the regular return.
Filing and Records
Returns are filed each assigned period even when no sales were made. Electronic returns are due the 20th and electronic payments the 25th. Every city and tax type is reported separately, so the books should record the code on each sale. Records, including exemption certificates, must be kept for at least three years. The Department of Revenue has a Sioux Falls office, but most filings are made online.
Sioux Falls Sales and Use Tax Questions
What is the sales tax rate in Sioux Falls?
For most sales it is 6.2 percent: 4.2 percent state tax plus the 2 percent Sioux Falls municipal tax. Restaurants, bars and admissions add the 1 percent municipal gross receipts tax, for 7.2 percent.
What taxes apply to a hotel room in Sioux Falls?
Stays of less than 28 days carry 9.7 percent: state 4.2, municipal 2, gross receipts 1, state tourism 1.5 and the 1 percent Sioux Falls lodging tax. Hotels with 40 or more rooms also charge a $2-per-night business improvement district tax paid to the city.
Will Lincoln County's new tax affect Sioux Falls?
Lincoln County is adopting a 0.5 percent county gross receipts tax from January 1, 2027, and part of Sioux Falls is in Lincoln County. Minnehaha County has not adopted it. Sellers should track which county each delivery address is in.
Do I need a city license to sell food from a truck in Sioux Falls?
Yes. Sioux Falls requires a mobile food vendor licence, $75 a year and expiring December 31. Applicants need a South Dakota sales tax number, health and fire inspections, and proof of insurance.
Talk to BOMCAS About Sales and Use Tax in Sioux Falls
Sales tax is far easier when the books already keep the city and gross receipts taxes out of revenue, and those totals then feed the federal business return. If returns have been missed, back taxes and late filing explains how we bring them current. Canadian suppliers shipping into the city should also read cross-border tax, and owners timing big purchases around the 2027 changes can plan them through tax planning. Many sales tax clients also hand us payroll and their personal returns. The statewide rules behind the rest of our work are explained on our South Dakota pages for business tax preparation, personal tax preparation, bookkeeping, payroll, tax planning, back taxes and late filing and cross-border tax, and the South Dakota overview brings them together.
Send us a short note about your Sioux Falls situation and we will come back with next steps. Reach us through the BOMCAS contact page or the form below, call 780-667-5250 or email info@bomcas.ca. You can also return to the Sioux Falls overview. Nothing on this page is advice for your specific circumstances.