Sales Tax Rules
North Dakota imposes a state sales tax rate of 5%, with a maximum combined rate (state plus local) of 8.5% when local taxes are added. Economic nexus is triggered at $100,000 in sales — meaning out-of-state businesses that exceed this threshold must collect and remit North Dakota sales tax. SaaS and digital software products are generally exempt from sales tax in North Dakota. Groceries are exempt from state sales tax.
SaaS Tax Details
SaaS is generally exempt; however, prewritten software via download is taxable.
Grocery Details
Most food and food ingredients are exempt.
What is the sales tax rate in North Dakota?
North Dakota's state sales tax rate is 5%. When local taxes are added, the maximum combined rate can reach 8.5%. The actual rate you pay depends on the county and city where the purchase is made.
What is the economic nexus threshold in North Dakota?
North Dakota requires out-of-state businesses to collect sales tax once they exceed $100,000 in sales in a calendar year. Once nexus is established, the business must register, collect, and remit North Dakota sales tax.
Is SaaS taxable in North Dakota?
No. SaaS products are generally exempt from sales tax in North Dakota. SaaS is generally exempt; however, prewritten software via download is taxable.
Are groceries taxed in North Dakota?
Groceries are generally exempt from sales tax in North Dakota. Most food and food ingredients are exempt.
Are digital goods taxable in North Dakota?
Digital goods are generally exempt from sales tax in North Dakota. However, tax law in this area evolves quickly — verify current rules with the North Dakota Department of Revenue.
Are clothing items exempt from sales tax in North Dakota?
Clothing is subject to sales tax in North Dakota at the standard state rate.
How often do I need to file sales tax in North Dakota?
North Dakota requires sales tax filing on a Monthly, Quarterly, or Annual. Online filing is available through the official Department of Revenue portal.
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Official Source
North Dakota Department of Revenue
Last verified: 2026-03-26 · Always confirm current rates with your tax advisor before filing.