The sales tax rate in Winona, Minnesota is 7.625%. That combined figure applies to most retail purchases inside the city and comes from three stacked layers: the Minnesota state rate, a Winona County tax, and a City of Winona local option tax.1Minnesota Department of Revenue. Local Sales and Use Tax Rate Guide – Q2 2026 Several categories of everyday purchases are exempt, and lodging carries an added charge on top of the standard rate.
How the 7.625% Rate Breaks Down
The largest piece is the statewide rate of 6.875%, set by Minnesota Statutes 297A.62. That figure is a 6.5% base plus a constitutionally mandated 0.375% addition dedicated to natural resources and arts funding, scheduled to expire July 1, 2034.2Minnesota Office of the Revisor of Statutes. Minnesota Code 297A.62 – Sales Tax Imposed; Rates
Winona County adds 0.25%, a tax that took effect April 1, 2025.3Minnesota Department of Revenue. Winona County 0.25% Local Sales and Use Tax The City of Winona layers on another 0.5% local option sales tax. Under Minnesota law, cities can only impose a local sales tax after receiving special legislative authority and voter approval, and the revenue must go toward specific voter-approved capital projects.4Minnesota Office of the Revisor of Statutes. Minnesota Code 297A.99 – Local Sales Taxes Add the three together and you get the 7.625% you see on receipts.
What’s Taxed and What’s Exempt
Most tangible goods sold at retail are taxable at the full 7.625% rate: furniture, electronics, household supplies, vehicles, and building materials, among others. Some services are taxable too, including fabrication labor that produces a new or changed product, installation labor, and telecommunications services.5Minnesota Department of Revenue. Taxable Sales
Minnesota exempts several categories of everyday purchases. Clothing designed for general wear is fully exempt, covering coats, shoes, underwear, and uniforms. The exemption doesn’t extend to accessories like jewelry, handbags, and watches, nor to sports-specific gear like cleats, ski boots, or hockey gloves. Fur clothing is also excluded from the exemption.6Minnesota Office of the Revisor of Statutes. Minnesota Code 297A.67 – General Exemptions – Section: Subd. 8 Clothing
Groceries get similar treatment. Food and food ingredients sold for home preparation are exempt, but candy, soft drinks, and dietary supplements are not. Drugs for human use, including over-the-counter medications, are also exempt.7Minnesota Office of the Revisor of Statutes. Minnesota Code 297A.67 – General Exemptions – Section: Subd. 7 Drugs; Medical Devices
Prepared Food and Lodging
The grocery exemption ends where preparation begins. Prepared food sold at restaurants, delis, food trucks, and convenience stores is fully taxable at the combined rate, and Minnesota defines prepared food broadly enough to capture most ready-to-eat items, including food sold through vending machines.8Minnesota Office of the Revisor of Statutes. Minnesota Administrative Rules 8130.4700 – Prepared Food, Candy, and Soft Drinks A raw chicken from the grocery store is tax-free. A rotisserie chicken from the same store’s deli counter is taxable.
Lodging carries an extra layer. Hotels and short-term rentals in Winona charge the standard sales tax plus a separate 4% city lodging tax,9City of Winona. Lodging Tax Return which primarily funds local tourism promotion with a portion supporting levee and marina improvements. A visitor renting a hotel room in Winona pays 11.625% in combined taxes on the room charge.
Use Tax on Untaxed Purchases
If you buy something for use in Minnesota and no sales tax was collected at the time of purchase, you owe use tax at the same 7.625% combined rate. This comes up most often with online purchases from out-of-state retailers that don’t collect Minnesota tax, items bought on trips to other states, and purchases from private sellers.10Minnesota Department of Revenue. Sales and Use Tax
Individuals can file and pay use tax electronically through the Department of Revenue’s website or by submitting a paper Form UT1. Businesses that already hold a sales tax permit report use tax on their regular sales and use tax return. It’s one of the most commonly overlooked tax obligations, and audit risk rises when a business makes large untaxed purchases for equipment or supplies from out-of-state vendors.
Collecting Sales Tax as a Winona Business
Any business making taxable sales in Minnesota needs a Minnesota Tax ID number from the Department of Revenue before collecting tax. To apply, you need your Federal Employer Identification Number (or Social Security Number for sole proprietors), your legal business name and any assumed name, your business address, and your North American Industry Classification System code. You can register online through the Department of Revenue’s Business Tax Registration portal or by filing a paper Application for Business Registration. Once registered, you’ll receive your filing frequency assignment and the permit you’re required to display at your place of business.11Minnesota Department of Employment and Economic Development. Tax Identification Numbers
Minnesota uses destination-based sourcing. If a customer walks into your Winona store and picks up a product, you charge the Winona rate. If you ship an order to a customer in Minneapolis, you charge the Minneapolis rate instead. For local sales taxes specifically, all sellers must collect based on where the customer receives the product, regardless of where the seller is located.12Minnesota Department of Revenue. Taxes and Rates
Resale Exemption Certificates
When a business buys inventory it plans to resell, it can purchase those goods tax-free by giving the seller a completed Minnesota Form ST3, Certificate of Exemption. The buyer claims the resale exemption and the seller keeps the certificate on file. Accepting a properly completed certificate relieves the seller of the obligation to collect tax on that transaction. If a buyer misuses an exemption certificate to avoid tax on goods they actually use rather than resell, Minnesota imposes a $100 penalty per fraudulent transaction on top of the use tax, interest, and any other penalties owed.13Minnesota Department of Revenue. ST3 Certificate of Exemption
Filing Returns and Late Penalties
Businesses file sales and use tax returns through the Department of Revenue’s e-Services portal. The Department assigns your filing frequency based on your monthly tax liability. Most new businesses start filing monthly or quarterly, though very low-volume sellers may qualify for annual filing. Payments go through electronic funds transfer.
Minnesota’s late-payment penalty structure escalates: 5% of the unpaid tax for the first 30 days late, with an additional 5% for each additional 30-day period, capping at 15% total. A separate 5% penalty applies if you fail to file the return itself on time, and interest accrues on late balances.14Minnesota Office of the Revisor of Statutes. Minnesota Code 289A.60 – Civil Penalties
Remote Sellers and Marketplace Platforms
Out-of-state sellers without a physical presence in Minnesota still must collect and remit state and local sales tax if they exceed either of two thresholds during the prior 12-month period: more than $100,000 in retail sales shipped to Minnesota, or 200 or more separate retail transactions shipped into the state. Once you cross either threshold, you have 60 days to register for a Minnesota Tax ID and begin collecting.15Minnesota Department of Revenue. Sales Tax for Remote Sellers
Marketplace platforms like Amazon, Etsy, and eBay have their own collection obligation. If a platform’s total sales into Minnesota, including sales it facilitates for third-party sellers, exceed the same $100,000 or 200-transaction thresholds, the platform must collect and remit the tax on behalf of its sellers.16Minnesota Department of Revenue. Sales Tax for Marketplace Providers If you sell through one of these platforms and it already collects Minnesota tax, you generally don’t need to collect again on those transactions. You remain responsible for collecting tax on any sales you make through your own website or at physical locations like trade shows.