The sales tax rate in Eagan, Minnesota is 7.125 percent. That figure combines Minnesota’s 6.875 percent state sales tax with Dakota County’s 0.25 percent transit tax. Eagan itself adds no city sales tax, so the rate is the same on every taxable purchase anywhere in the city.
How the Rate Breaks Down
Minnesota’s state sales tax has two statutory pieces. The base rate is 6.5 percent, and a voter-approved constitutional addition of 0.375 percent brings the state portion to 6.875 percent. The add-on, codified in Minnesota Statute 297A.62, funds the state’s environment and natural resources trust fund and is set to expire July 1, 2034.1Minnesota Office of the Revisor of Statutes. Minnesota Statutes 297A.62 – Tax
The remaining 0.25 percent is Dakota County’s transit sales and use tax, which took effect October 1, 2017 to fund regional transportation projects.2Minnesota Department of Revenue. Dakota County 0.25 Percent Transit Sales and Use Tax State law authorizes counties to impose a transportation sales tax of up to one-half of one percent under Minnesota Statute 297A.993, so Dakota County is using half of its allowable authority.3Minnesota Office of the Revisor of Statutes. Minnesota Statutes 297A.993
Because Eagan has no separate city sales tax, 7.125 percent applies citywide. Neighboring cities within Dakota County share the same combined rate unless they impose their own local tax.
What You Won’t Pay Sales Tax On
Minnesota exempts several categories of everyday purchases under Statute 297A.67, so the 7.125 percent will not apply to everything in your cart.
Clothing
Most clothing and footwear for general wear is tax-free in Minnesota. Shirts, pants, coats, shoes, sneakers, underwear, and baby clothing all qualify. The exemption does not reach accessories like jewelry, handbags, and wallets, and it does not cover sports-specific gear such as cleated shoes, ski boots, or hockey gloves. Fur clothing and protective equipment like hard hats and safety goggles are taxable.4Minnesota Office of the Revisor of Statutes. Minnesota Statutes 297A.67 – Exemptions for Certain Goods
Food and Groceries
Grocery items sold for home consumption are exempt, including produce, meat, dairy, bread, frozen meals, and coffee. The exemption falls away for candy, soft drinks, dietary supplements, and prepared food sold with eating utensils. Minnesota’s definition of “candy” is broad enough to pull in marshmallows, honey-roasted nuts, and baking chips with sweeteners, which catches some shoppers off guard.5Minnesota Department of Revenue. Food and Food Ingredients Alcoholic beverages are always taxable.4Minnesota Office of the Revisor of Statutes. Minnesota Statutes 297A.67 – Exemptions for Certain Goods
Medications and Medical Devices
Prescription and over-the-counter drugs are exempt, along with insulin, medical oxygen, prosthetic devices, durable medical equipment for home use, mobility-enhancing equipment, prescription eyeglasses, and kidney dialysis equipment.4Minnesota Office of the Revisor of Statutes. Minnesota Statutes 297A.67 – Exemptions for Certain Goods
Services That Do Carry the 7.125 Percent
Minnesota taxes more services than many states, so some bills in Eagan carry the full rate even though no physical goods change hands. Under Statute 297A.61, taxable services include:
- Building and residential cleaning, janitorial work, disinfecting, and pest control
- Laundry, dry cleaning, pressing, alterations, linen services, and carpet or upholstery cleaning (coin-operated self-service laundry is exempt)
- Car washes, waxing, rustproofing, and towing
- Security and detective services, including burglar alarms, fire alarms, and armored car services
- Pet grooming
- Admissions to entertainment venues, recreational areas, and athletic events
- Lodging at hotels, motels, resorts, and campgrounds for stays shorter than 30 consecutive days
- Nonresidential parking, including hourly and contract parking (metered spots are excluded)
Many professional and personal services remain untaxed in Minnesota, including accounting, legal work, and haircuts.6Minnesota Office of the Revisor of Statutes. Minnesota Statutes 297A.61 – Definitions
Online and Out-of-State Purchases
When you buy something taxable from a seller that does not collect Minnesota sales tax, you owe use tax at the same 7.125 percent rate. The issue comes up most often with online orders from smaller out-of-state retailers, mail-order catalogs, and items picked up while traveling.
Minnesota gives individuals a modest break: you do not owe use tax unless your total untaxed purchases for the year exceed $770, which works out to roughly $53 in tax liability.7Minnesota House of Representatives. Minnesota Sales and Use Tax Above that threshold, you report the tax on your Minnesota individual income tax return. Businesses have no equivalent exemption and must report and remit use tax on every qualifying purchase.