Car Sales Tax in South Dakota

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The sales tax in South Dakota is very low at 4%. Vehicles sold in South Dakota are subject to this tax rate as well as any additional local taxes.
When you’re shopping for a car, it’s easy to forget about any cost beyond the sticker price. After all, that’s the cost that’s highlighted in big red letters! You could end up over your budget if you fail to consider all the costs of buying a car, though.
A significant added cost in the state of South Dakota is sales tax. But what are the rules and guidelines around sales tax, and are there any exceptions? 
Here to answer all your South Dakota car sales tax questions is the
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How much is the car sales tax rate in South Dakota?

All car sales in South Dakota are subject to the 4% statewide sales tax. Different areas have varying additional sales taxes as well. The highest sales tax is in Roslyn with a combined tax rate of 7.5%, and the lowest rate is in Buffalo and Shannon Counties with a combined rate of 4.5%. The average sales tax rate on vehicles across the state is 5.814%.

How are car trade-ins taxed in South Dakota? 

Which parts of the car-buying process are taxed, though? To save money on buying a new car, many people opt to trade in their old vehicle and apply the credit to their new purchase. This is a great way to save on sticker price—and sales tax! Car sales tax does not apply to the trade-in value during a vehicle sale.
For example, we’ll pretend you’re buying a new
Subaru Forester
for $23,395. You’re saying goodbye to your old
Nissan Rogue
and are receiving a trade-in credit of $3,500. You’ll only have to pay the combined sales tax average rate of 5.814% on $19,895 of the purchase.
Don’t forget though—dealer rebates and incentives are still subject to sales tax. You will be taxed on the sales price before these discounts are applied.

How to calculate sales tax on a car in South Dakota

You can use the
sales tax rate calculator
on the South Dakota Department of Revenue website to determine the total sales tax based on the dealership’s address. From there, you can apply that percentage to your dream vehicle’s price to get a sense of the total purchase price.
Key Takeaway To get the total sales tax for your car, you’ll need to combine the statewide rate of 4% with whatever the dealership’s local or county tax rate is.

Exemptions from South Dakota sales tax

South Dakota offers a lot of exemptions to its vehicle sales tax. Some exceptions include:
  • Vehicles acquired by inheritance
  • Vehicles transferred between spouses, between parents and children, and between siblings
  • Vehicle given to satisfy a debt
For a full list of exemptions,
check out this list
from South Dakota’s Department of Revenue. 

How to estimate South Dakota sales tax, title, and registration fees

The best way to shop for a car is by getting informed about all the costs you can expect. Sales tax is a given, but what are some other fees you could incur? It’s important that you consider the
certificate of title
vehicle registration
, plate transfer, and documentation fees when calculating your total budget.
This is how the costs line up in South Dakota:
Average cost
Sales tax
4% + local/county tax
Registration fee
4% of purchase price + $50 if electric
Title fee
Plate transfer
Documentation fee
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South Dakota Department of Revenue
has more details on its website.

How to find affordable car insurance in South Dakota

We still have to talk about the final cost to factor in when purchasing a car, and it’s a big one—
car insurance
. With so many carriers and plans available, it’s easy to get overwhelmed and end up overpaying. You won’t have to worry about it when you shop with
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The Jerry app takes your information and shops with over 50 top insurance companies on your behalf before reporting back to you with the absolute best quotes available. You can choose your rate and coverage, and then stop worrying about it because Jerry automatically shops for new policies when yours is up for renewal. 
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Whether your car is brand new or used, you’ll pay the same in sales tax. Vehicles in South Dakota are subject to the 4% statewide sales tax, plus any local or county taxes.
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