Motor carrier taxes - North Dakota

Sales & use taxes

North Dakota imposes a sales and use tax within the state. The sales tax is imposed on all retail sales, and the use tax is owed if sales tax was not collected by the seller on tangible personal property brought or shipped into North Dakota for storage, use, or consumption. A purchaser owes North Dakota use tax is the sales and use tax paid in another state was not at a rate equal to or greater than the North Dakota sales tax rate.

Freight, delivery, and other transportation charges are considered part of the selling price. If the sale is taxable, the freight, delivery, and other transportation charges that are part of the sale and billed by the seller are taxable. If the product being delivered is exempt from sales tax, then freight, delivery, and other transportation charges are also exempt. Delivery charges billed directly to the customer by delivery services that are not making the sale of tangible personal property remain exempt from sales and use tax.

The sales of licensed motor vehicles, including trailers and semitrailers, are subject to a motor vehicle excise tax instead of state and local sales taxes. Vehicles required to be registered within North Dakota must pay a motor vehicle excise tax on the purchase price, or on the fair market value of the vehicle if not acquired through a purchase. North Dakota allows credit for any excise tax paid on a motor vehicle in another state if that state allows a reciprocal credit.

Motor carrier vehicles in excess of 20,000 pounds gross weight, whether owned or lease, engaged in interstate commerce to the extent their revenue from interstate hauling bears to their total revenue from hauling for the preceding operating year are exempt from the excise tax. Additional exemptions to the motor vehicle excise tax can be located within section 81-05.1-01-03 of the North Dakota Administrative Code.