Taxes

Taxes

South Dakota is business friendly when it comes to tax climate, coming in at an impressive #2 in the Tax Foundation´s 2016 State Business Tax Climate Index. With no corporate or personal income taxes, no inventory tax, no inheritance tax, no personal property tax, and low sales tax, you can´t get much friendlier than that. According to the Tax Foundation, every type of firm in South Dakota has a lighter tax burden than the national average: 33% lower for the average firm. Businesses also benefit from low property and unemployment insurance taxes.


Sioux Falls Development Foundation, South Dakota is ranked 2nd in the U.S. for tax climate.

South Dakota Iowa Minnesota Nebraska North Dakota Wyoming
Property Tax Rate (per 1000) $11.96 $14.29 $14.29 $15.66 $10.74 $21.75
Sales Tax 4.0%* 6.0% 6.9% 5.5% 5.0% 4.0%
Individual Income Tax 0.0% 9.0% 9.9% 6.8% 3.2% 0.0%
Corporate Income Tax 0.0% 12.0% 9.8% 7.8% 4.5% 0.0%
Tax Burden 7.1% 9.3% 10.7% 9.4% 8.8% 7.0%

Cost of Living: The Sioux Falls Advantage

The cost of living is better in Sioux Falls, thanks in part to no personal income tax, low real property and sales taxes, affordable housing and utility costs, and a favorable climate. The overall cost of living is 6% lower than the national average.

  Read More

2015 State Business Tax Climate Index Ranks and Component Tax Ranks

Overall Rank Corporate Tax Rank Individual Income Tax Rank Sales Tax Rank Unemployment Insurance Tax Rank Property Tax Rank
Iowa 41 49 32 23 33 38
Kansas 22
38 18 30 9 28
Minnesota 47 44 46 37 29 34
Nebraska 29 31 25 27 13 39
North Dakota 25 19 36 20
16 2
South Dakota
2 1 1 35 41 18
Note: 1 is best, 50 is worst. Report shows tax systems as of July 1, 2014.,Source: Tax Foundation calculations.