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

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.

Senate Bill 43 gives such businesses at least 30 days to register. Per the bill, a remote seller or marketplace is not required to register prior to the first day of the first month that begins at least 30 days after creating economic nexus with South Dakota. 

The enactment of SB 43 would bring 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.

Today, a remote seller that establishes economic nexus with South Dakota on February 4 would need to register with the South Dakota Department of Revenue immediately. If South Dakota adopts this SST best practice and enacts SB 43, that remote seller would have until April 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. 

As the law now stands, you must register and start collecting sales tax as soon as you establish sales tax nexus. If SB 43 becomes law — which looks likely — you’ll have at least 30 days to prepare.

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 delivered to the governor on February 10, 2025, would help with that. 

The bill offers a potential benefit for South Dakota businesses as well. If South Dakota grants remote retailers more time to register, other states may extend the same grace to remote retailers based in the Mount Rushmore State.  

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.