What is the sales tax rate for Minnesota?
The statewide sales tax rate in Minnesota is 6.875% as of 2025. This base rate applies to most retail sales of tangible goods, certain digital products, and taxable services throughout the state.
However, the total sales tax you pay may be higher, depending on local add-on taxes imposed by cities, counties, or special taxing districts.
Key Breakdown of Sales Tax in Minnesota:
1. State Sales Tax (6.875%)
This is the base rate applied to most taxable transactions across the state. It covers:
- Retail sales of physical goods
- Prepared food and beverages
- Certain digital products
- Specific services (e.g., lodging, admissions)
2. Local Sales Taxes (0.15% - 2.0%+)
Cities and counties may add their own sales tax rates:
- These are stacked on top of the state rate
- Total combined rates vary by location
- Example:
- Minneapolis: 8.025% (includes 1.15% local tax)
- Duluth: 8.875% (includes multiple local components)
3. Special Taxes
Certain goods and services may be subject to extra excise taxes:
- Liquor, lodging, prepared food, and vehicle rentals may carry higher rates.
- Special district taxes may apply in transportation improvement or stadium zones.
Exemptions and Special Categories
Minnesota exempts several categories from sales tax, including:
- Most clothing
- Groceries (unprepared food)
- Prescription medications and medical devices
- Some agricultural and industrial products
While the base sales tax rate in Minnesota is 6.875%, many areas impose additional local taxes that increase the total rate. If you’re a business owner, it’s essential to calculate and collect the correct rate based on your customer’s location. For multistate sales tax compliance, firms like One IBC USA offer expert support tailored to your operations.