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FAQ Articles

Are retail sales to American Indians subject to sales tax?

Retail sales to American Indians are taxable if possession of the goods takes place off the reservation.

If the retailer delivers the goods to an American Indian who is an enrolled member residing on any federally recognized Indian reservation or trust property, except Standing Rock Sioux Tribe reservation, the goods are not subject to sales tax.  American Indians who take possession of the goods on the reservation, other than Standing Rock Sioux Tribe reservation, without paying the tax are required to pay use tax on the purchase price of the goods if the goods are removed from the reservation for use elsewhere.

Effective July 1, 2009, American Indian Tribal governments are exempt from the payment of sales tax if they provide their sales tax exemption certificate to the retailer at the time of purchase. The exemption applies to tribal government agencies, instrumentalities, or political subdivisions that perform essential government functions.

The exemption does not apply to business entities owned by the tribe or tribal agencies with the primary purpose of operating a business entity.

Standing Rock Sioux Tribe: 

The 2015 Legislature authorized the governor to enter into an agreement with the Standing Rock Sioux Tribe for the Office of State Tax Commissioner’s administration of state-level and local-level tribal sales, use, and gross receipts taxes imposed within the exterior boundaries of the North Dakota portion of Standing Rock Sioux Reservation.

Effective July 1, 2016, the Standing Rock Sioux Tribe imposed a 5 percent general sales and use tax, a 3 percent sales and use tax on new manufactured homes, a 7 percent alcohol gross receipts tax, and a 3 percent farm machinery gross receipts tax on new farm machinery and new farm irrigation equipment. All of these taxes are identical to North Dakota’s sales use, and gross receipts taxes. All exemptions that apply to the state’s taxes also apply to the tribal taxes.

In addition to the tribal imposed 3 and 5 percent sales and use taxes, 7 percent alcohol gross receipts tax, and 3 percent new farm machinery and new farm irrigation equipment gross receipts tax, the Standing Rock Sioux Tribe also imposed a .25 percent tribal local tax that will apply to all transactions subject to the state-level taxes. As a result, all taxable transactions on the Standing Rock Sioux Reservation will be subject to one state-level (state or tribe) 5, 7, or 3 percent tax and an additional .25 percent tribal local tax. The tribal local .25 percent tax will apply to all transactions in the same manner as a city or county sales, use, or gross receipts tax.

nd.gov - The Official Portal for North Dakota State Government
North Dakota: Legendary. Follow the trail of legends

Ryan Rauschenberger
Tax Commissioner
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FAQ Articles

Are retail sales to American Indians subject to sales tax?

Retail sales to American Indians are taxable if possession of the goods takes place off the reservation.

If the retailer delivers the goods to an American Indian who is an enrolled member residing on any federally recognized Indian reservation or trust property, except Standing Rock Sioux Tribe reservation, the goods are not subject to sales tax.  American Indians who take possession of the goods on the reservation, other than Standing Rock Sioux Tribe reservation, without paying the tax are required to pay use tax on the purchase price of the goods if the goods are removed from the reservation for use elsewhere.

Effective July 1, 2009, American Indian Tribal governments are exempt from the payment of sales tax if they provide their sales tax exemption certificate to the retailer at the time of purchase. The exemption applies to tribal government agencies, instrumentalities, or political subdivisions that perform essential government functions.

The exemption does not apply to business entities owned by the tribe or tribal agencies with the primary purpose of operating a business entity.

Standing Rock Sioux Tribe: 

The 2015 Legislature authorized the governor to enter into an agreement with the Standing Rock Sioux Tribe for the Office of State Tax Commissioner’s administration of state-level and local-level tribal sales, use, and gross receipts taxes imposed within the exterior boundaries of the North Dakota portion of Standing Rock Sioux Reservation.

Effective July 1, 2016, the Standing Rock Sioux Tribe imposed a 5 percent general sales and use tax, a 3 percent sales and use tax on new manufactured homes, a 7 percent alcohol gross receipts tax, and a 3 percent farm machinery gross receipts tax on new farm machinery and new farm irrigation equipment. All of these taxes are identical to North Dakota’s sales use, and gross receipts taxes. All exemptions that apply to the state’s taxes also apply to the tribal taxes.

In addition to the tribal imposed 3 and 5 percent sales and use taxes, 7 percent alcohol gross receipts tax, and 3 percent new farm machinery and new farm irrigation equipment gross receipts tax, the Standing Rock Sioux Tribe also imposed a .25 percent tribal local tax that will apply to all transactions subject to the state-level taxes. As a result, all taxable transactions on the Standing Rock Sioux Reservation will be subject to one state-level (state or tribe) 5, 7, or 3 percent tax and an additional .25 percent tribal local tax. The tribal local .25 percent tax will apply to all transactions in the same manner as a city or county sales, use, or gross receipts tax.

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