North Dakota Clarifies Direct-To-Consumer (DtC) Wine Sales & Use Tax Requirements

North Dakota tax laws are being interpreted by the Office of State Tax Commissioner to require out-of-state direct shipper licensees to collect and remit local sales and use taxes on wine shipped to consumers in ND, in addition to the 7% state alcohol beverage gross receipts tax.

A winery that has been issued a Direct Shipper license is required to collect local sales and use taxes even if the licensee does not have nexus within the local taxing jurisdiction. The 7% state alcohol beverage gross receipts tax and local sales and use taxes are also imposed on the cost of shipping.

Prior to making shipments into ND a winery must obtain a Direct Shipper license and a Sales and Use Tax Permit. Taxpayers may choose to file paper sales and use tax returns or file online via the ND Taxpayer Access Point (TAP).

A return form will be mailed for all paper filers and an email reminder for all TAP filers based on the filing frequency assigned at the time of registration. A return must be filed for each reporting period even if no sales were made or no tax is due.

Direct Shippers are required to:

  • pay an annual $50 license fee,
  • pay liquor tax on the total gallons of wine shipped to ND consumers and
  • file a direct shipper’s annual tax report.

More information on the direct shipper license and reporting requirements are available on the State Tax Commission website.

 

ShipCompliant clients, we recommend that you adjust your North Dakota tax settings to include local rates in the Tax Preferences section of your account. For further assistance or other questions, please contact support@shipcompliant.com

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