Sioux Falls, SD Short-Term Rentals: Taxes & Fees (2026)

South Dakota law layers four separate taxes on short-term lodging. SDCL § 10-45-2 imposes the general 4.2% state sales tax on the gross receipts from any retail sale of services, including transient lodging. SDCL § 10-45D-2 imposes an additional 1.5% tourism tax on "the gross receipts of any hotel, motel, campground, lodging house, or other lodging establishment" — which the South Dakota Department of Revenue interprets to include short-term rentals booked through online platforms. SDCL § 10-52-2 authorizes municipalities to impose a municipal sales tax of up to 2%; Sioux Falls has enacted the full 2% via its home-rule charter. SDCL § 10-52A-1 separately authorizes a municipal gross-receipts tax of up to 1% on lodging, eating establishments, and alcoholic beverages (the "BBB" tax); Sioux Falls levies the full 1% on lodging. South Dakota's marketplace-facilitator law (SDCL Ch. 10-65, enacted in response to South Dakota v. Wayfair) requires Airbnb, Vrbo, and similar platforms to collect and remit state-level sales and tourism taxes directly. Municipal taxes (Sioux Falls's 2% sales tax and 1% BBB) are also generally remitted by the major platforms under voluntary collection agreements with the South Dakota Department of Revenue, but a host renting directly (via a personal website, Craigslist, or word of mouth) must register for a SD sales tax license and remit all four layers personally. Sioux Falls does not impose a separate STR permit fee or registration fee at the city level — there is no Sioux Falls STR business-license program as of 2026.