Sales Tax
Sales Taxes: New Requirements for Marketplace Providers in S. Dakota
Other states may follow, as South Dakota is a trendsetter in sales and use tax compliance since the landmark ruling in Wayfair vs. South Dakota, in which the U.S. Supreme Court granted states more power in taxing ecommerce sales transactions.
Mar. 01, 2019
Certain remote sellers have been compelled to collect and remit sales tax on their sales into South Dakota since November 1, 2018. Starting March 1, 2019, a similar requirement will fall on the shoulders of certain marketplace facilitators.
Other states may follow, as South Dakota is a trendsetter in sales and use tax compliance since the landmark ruling in Wayfair vs. South Dakota, in which the U.S. Supreme Court granted states more power in taxing ecommerce sales transactions.
A marketplace provider or facilitator must obtain a South Dakota sales tax license and collect and remit sales tax on all sales facilitated into the state if, in the current or previous calendar year, it:
- Is a remote seller that exceeds $100,000 in gross sales or 200 or more separate transactions into South Dakota in the previous or current calendar year; or
- Facilitates the sales of at least one marketplace seller that exceeds $100,000 in gross sales or 200 or more separate transactions into South Dakota in the previous or current calendar year; or
- Facilitates the sales of two or more marketplace sellers that, when the sales are combined, exceeds $100,000 in gross sales or 200 or more separate transactions into South Dakota in the previous or current calendar year.
Collecting marketplace facilitators are required to inform third-party sellers that South Dakota sales tax is being reported and remitted on all marketplace sales. They do not, however, need to give marketplace sellers a resale certificate.
Marketplace sellers that make sales through multiple channels may be required to register with the state and collect and remit sales tax on other sales into the state. See the South Dakota Department of Revenue for additional information.
Learn more about how different marketplace facilitator sales tax laws affect marketplace sellers.