Tax Laws in South Dakota.

South Dakota has no state individual income tax. Combined with the tax-friendly treatment of trust income, SD is a leading trust-situs jurisdiction.

South Dakota has no state corporate income tax. A distinctive feature among U.S. states. Bank Franchise Tax (SDCL Chapter 10-43) applies to financial institutions.

4.2% state sales tax (reduced from 4.5% in 2023). Local option sales taxes produce combined rates commonly 6.5-7.5%. South Dakota sales tax is famously broad — covering many services exempt in other states.

Graduated tax on financial institutions' net income (0.25% to 6%). Revenue from this tax reflects SD's major credit-card industry.

Property taxes administered by counties. South Dakota's property tax is a significant revenue source given absence of income tax.

South Dakota's economic-nexus sales tax law (SDCL § 10-64-2) triggered the Supreme Court decision overturning Quill v. North Dakota. Now remote sellers with $100K+ SD sales or 200+ transactions must collect sales tax. Landmark national precedent.

Combined with the unlimited-duration trust framework, SD is among the most estate-tax-favorable jurisdictions in the U.S.