South Dakota gives remote sellers more time to register for sales tax

South Dakota is giving remote sellers and marketplace providers more time to register for sales tax after establishing economic nexus. Here’s what you need to know.

Currently, a remote seller or marketplace provider (aka marketplace facilitator) must register with the South Dakota Department of Revenue and start collecting South Dakota sales tax immediately after establishing economic nexus with the state — that is, on the very next transaction.

With the enactment of Senate Bill 43, a remote seller or marketplace is “not required to register and remit the tax… prior to the first day of the first month that begins at least 30 days” after creating economic nexus with South Dakota. The bill takes effect July 1, 2025.

SB 43 brings South Dakota in line with one of the best practices of the Streamlined Sales and Use Tax Agreement (SSUTA, or simply SST), which was created to reduce the burden and costs of sales tax compliance.

This policy change will give remote sellers much-needed breathing room. A remote seller that established economic nexus with South Dakota on February 4, 2025, needed to register with the South Dakota Department of Revenue immediately. Under SB 43, a remote seller that establishes economic nexus on July 4, 2025, has until September 1 to register with the department and start collecting sales tax.  

Economic nexus is an economic connection that creates a sales tax obligation for a business with no physical tie to a state. It became a thing after the Supreme Court of the United States overturned the physical presence requirement in South Dakota v. Wayfair, Inc. (June 21, 2018).

South Dakota was the trendsetter, but every state with a general sales tax now has an economic nexus law. And every economic nexus law provides an exception for businesses with sales in the state beneath a certain economic nexus threshold.  

You can find details about each state’s threshold in our state-by-state guide to economic nexus laws.

You’re required to register for South Dakota sales tax and comply with all applicable sales and use tax laws if you have a physical presence in the state (physical nexus). 

You’re also required to register then collect and remit sales tax if you meet or exceed South Dakota’s economic nexus threshold, which is $100,000 in gross revenue in the state in the previous or current calendar year. 

SB 43 is good news for remote online retailers and marketplace providers. It gives them additional clarity and breathing room in South Dakota.

Businesses generally want to comply with the law. But as Alison Jares, Deputy Director at the State of South Dakota, told the Legislature on February 4, businesses often need time to come into compliance. They may not be able to comply by the very next sale. In fact, they may not even immediately realize that they’re required to register for sales tax. 

SB 43, which was signed by the governor on February 18, 2025, helps with that. 

Avalara can help you register for sales tax in South Dakota and other states. The Avalara suite of products can also help your business automate the calculation, collection, and remittance of sales tax. Learn how you can improve your tax compliance process.

This bill was updated to reflect the enactment of SB 43.