South Dakota – Uber Sales Tax License

SALT Report 3834 – A month after Uber applied for a license to start operating in Sioux Falls, the local market is still off limits for the ride-sharing company that connects drivers and ride-seekers.

A new state law opening the door for Uber, Lyft and other transportation network companies, or TNCs, in South Dakota went into effect July 1. In anticipation of the new market, Raiser LLC, a subsidiary of Uber, applied June 9 for a TNC license in Sioux Falls.

City Hall, though, still hasn’t granted Uber its license because proof of a sales tax license has yet to be provided, one of the stipulations included in the city’s revamped driver-for-hire rules that took effect last fall.

“The TNC license for Raiser LLC has not been issued yet because they are required to obtain a sales tax license and they have not provided me with that information,” said Jamie Palmer, city licensing specialist.

The reason for the holdup is simple: Raiser does not have a South Dakota sales tax license, according to the Revenue Department in Pierre.

Uber spokeswoman Carla Jacobs wouldn’t say Wednesday if the company plans to obtain a sales tax license, only that it’s “continuing to work with the city on our TNC application.”

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