Vermillion Sales and Use Tax

Sales Tax With an Open Question

Vermillion businesses are waiting on one decision. Clay County commissioners adopted a half-percent county sales tax in a 3–2 vote, residents petitioned to refer it, and voters will decide on November 17, 2026. If it passes, the county tax begins July 1, 2027, the same day the state rate is scheduled to rise. BOMCAS prepares sales tax returns for Vermillion businesses remotely and will update rates as soon as the result is known.

Licensing and taxable services are explained on the South Dakota sales and use tax page. Vermillion's codes, game-day admissions and the Clay County vote are covered below.

Vermillion Rates

General sales and taxable services: 4.2 percent state plus 2 percent city (362-2), or 6.2 percent.
Prepared food, alcohol, lodging and admissions: another 1 percent city gross receipts tax (362-1), for 7.2 percent.
Lodging for stays under 28 days: the 1.5 percent state tourism tax too.
Hotels in Business Improvement District No. 1: $2 per occupied room night.

Two Possible Rates for July 2027

From July 1, 2027, the state rate is scheduled to be 4.5 percent. Without a county tax, Vermillion's general rate would be 6.5 percent; with it, 7.0 percent. Meals, drinks, lodging and admissions would be 7.5 or 8.0 percent. Businesses printing menus, setting up new registers, quoting contracts or budgeting for 2027 should plan for both until the vote is settled.

Game Days and Events

Coyote football, basketball and volleyball, concerts and other events at the DakotaDome and the Sanford Coyote Sports Center bring visitors to Vermillion. Admission charges for events are subject to the city's gross receipts tax as well as state tax. Food trucks, vendors and pop-up sellers working those events need a South Dakota sales tax licence, and peddlers and mobile food vendors also need a city licence through Vermillion's permit system.

Student Rentals and Short Stays

Long-term rentals of houses and apartments to students are not subject to sales tax. Renting the same property by the night for commencement, homecoming or game weekends is lodging and subject to state and city tax, the city's 1 percent and the tourism tax. Owners using online platforms should check which taxes the platform collects.

Manufacturers and Distributors

Manufacturing equipment and materials that become part of a product are treated differently from supplies the business uses up. Sales to customers in other states are shipped out of South Dakota and generally exempt here, though they may be taxable in the destination state. Distributors receiving resale certificates should keep them on file and current.

Contractors

Contractors in Vermillion pay the 2 percent contractor's excise tax on gross receipts for realty improvements and sales or use tax on materials. Work on university buildings is generally subject to the excise tax too, even though the state is the owner. Plumbing contractors need a city licence and a $10,000 bond, and electricians and sewer and water installers also need city licences.

Use Tax

Items bought online or out of state without South Dakota tax are subject to use tax at the Vermillion rate when used here. This includes equipment, software, furniture for rentals and supplies.

Filing

We prepare returns, reconcile them to sales reports, keep exemption certificates in order and update rates after the November vote and again in July 2027.

Taxable Services Near Campus

Many services popular with students are taxable in South Dakota, including hair and nail care, phone and computer repair, printing and dry cleaning. New service businesses should register before their first sale rather than after a busy semester.

After the Vote

Once the Clay County result is certified, we will tell clients which rate applies from July 1, 2027, update their tax settings and check that online stores and point-of-sale systems are ready before that date, so no one undercharges or overcharges customers during the change.