Avalara Taxrates > Blog > Sales Tax News > Sturgis Sales Tax Revenue Skyrockets - Avalara

New Reporting Requirements Increase Sturgis Sales Tax Revenue


 Sales tax revenue has surged at the Sturgis Rally, thanks to stricter reporting requirements and enforcement.

The Sturgis Motorcycle Rally had its 75th birthday last August, which drew larger than normal crowds to South Dakota’s largest annual event and 45% more revenue than the previous year. It also brought in an astounding amount of sales tax revenue — almost 65% more than in 2014.

The revenue increase is not simply attributable to a surge in spending, though certainly that plays a part. It is largely due to a change in vendor requirements and enforcement.

Vendors are now required to give every customer a receipt and to keep a copy of that receipt (for audit purposes). Temporary city employees roam the city during the rally, checking vendor’s licenses. Police provide spot checks of merchants’ books. As a result, more temporary vendors reported more sales tax in 2015 than in previous years. The new policy will therefore remain in place.

City Manager Daniel Ainslie says the city owes a debt of gratitude to the Police Department: “Because of their enforcement, the community has received hundreds of thousands of dollars in additional sales tax for the past three years and for the foreseeable future.”

Ainslie also praised the “city’s financial department, the city attorney, and the mayor, who made visits to Pierre to talk to the South Dakota Department of Revenue about stepping up its tax-collection efforts.” He said the reporting changes are “going to make a difference for our community.”

Sturgis sales tax revenue has been on the rise since 2013, and not only during the August rally. According to City Manager Daniel Ainslie, “[T]he City has exceeded both the state wide average as well as the Black Hills regional average sales tax growth for three years straight.” The growth is “a direct result of local sales activity.” Residents are shopping local. More businesses are opening in the city, and additional tourist events are increasing tourism year-round.

Sales tax automation facilitates sales tax compliance for businesses reporting in multiple jurisdictions. Learn more.

photo credit: Black Hills Motorcycle Rally via photopin (license)


Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.