South Dakota State Tax Guide

South Dakota state tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact residents.

South Dakota flag blowing in the wind on a cloudy day used for a South Dakota state tax article
(Image credit: Getty Images)

South Dakota State Tax: Overview

South Dakota has no income tax. The combined state and local sales tax rate is fairly low when compared to other states. But, sales tax in South Dakota applies to both groceries and clothing.

South Dakota's median property tax rate, is fairly high when compared to other states.

[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.] 

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

South Dakota Income Taxes

South Dakota has no income tax.

South Dakota Sales Tax

The sales tax in South Dakota is 4.50%. The average local sales tax is 1.90%, resulting in a combined sales tax rate of 6.40%, according to the Tax Foundation.

  • Groceries: Taxable
  • Clothing: Taxable
  • Motor Vehicles: Exempt from ordinary sales tax, but taxable under special 4% excise tax
  • Prescription Drugs: Exempt

South Dakota Real Property Taxes

In South Dakota, the median property tax rate is 1.17% of assessed home value, according to the Tax Handbook.

South Dakota Property Tax Breaks for Retirees

South Dakota offers a property tax homestead exemption for homeowners 70 or older (or surviving spouses), which delays payment of property taxes until the property is sold. Taxes are a lien on the property.

A property tax "freeze" is also available for seniors 65 and older. To qualify for the assessment freeze, you must meet income requirements and have resided in a single-family dwelling for at least 200 days of the previous calendar year.

South Dakota Motor Fuel (Gas) Taxes

Swipe to scroll horizontally
Gasoline$0.30 per gallon
Diesel$0.30 per gallon

Source: Sales Tax Handbook

South Dakota Tobacco and Alcohol Taxes

Swipe to scroll horizontally
Cigarette$1.53 per pack
Other Tobacco Products35% of the wholesale price
Medical Marijuana0.00%
Recreational Marijuana19.50% (4.50% cannabis sales tax + 15% state excise tax)

Source: Sales Tax Handbook

Swipe to scroll horizontally
Beer$0.27 per gallon
Wine$0.93 per gallon
Liquor$3.93 per gallon

There is also a 2% wholesale tax on wine and liquor.

Source: Sales Tax Handbook

South Dakota Estate and Inheritance Taxes

South Dakota has no estate or inheritance tax.

Rocky Mengle

Rocky Mengle was a Senior Tax Editor for Kiplinger from October 2018 to January 2023 with more than 20 years of experience covering federal and state tax developments. Before coming to Kiplinger, Rocky worked for Wolters Kluwer Tax & Accounting, and Kleinrock Publishing, where he provided breaking news and guidance for CPAs, tax attorneys, and other tax professionals. He has also been quoted as an expert by USA Today, Forbes, U.S. News & World Report, Reuters, Accounting Today, and other media outlets. Rocky holds a law degree from the University of Connecticut and a B.A. in History from Salisbury University.

With contributions from