Arizona: Sales Tax Handbook
Arizona Sales Tax Rate
|State Sales Tax||Local Sales Tax Range||Average Local Tax||Average Combined Tax||Max Combined Tax|
|5.60%||0.25% - 5.30%||2.103%||7.703%||10.9%|
2016 Arizona Sales Tax Handbook
Arizona Table of Contents
- List of Local Sales Tax Rates
- Sales Tax Calculator
- Sales Tax Exemption Certificates
- Sales Tax Info For Businessowners
- Taxable vs. Non-Taxable Purchases
- Sales Tax on Cars & Vehicles
- More Information
Arizona's Transaction Privilege Tax By The Numbers:
Arizona has a higher-than-average sales tax, including when local sales taxes from Arizona's 92 local tax jurisdictions are taken into account.
Rankings by Average State + Local Sales Tax:
Ranked 12th highest by combined state + local sales tax
Ranked 10th highest by per capita revenue from state + local sales taxes ($1,323 per capita)
Rankings by State Sales Tax Only:
Ranked 9th highest by state sales tax rate
Ranked 14th highest by per capita revenue from the statewide sales tax ($982 per capita)
Printable PDF Arizona Sales Tax Datasheet
Arizona has a statewide transaction privilege tax rate of 5.60%, which has been in place since 1933.
Municipal governments in Arizona are also allowed to collect a local-option sales tax that ranges from 0.25% to 5.30% across the state, with an average local tax of 2.103% (for a total of 7.703% when combined with the state sales tax). The maximum local tax rate allowed by Arizona law is 5.30%. You can lookup Arizona city and county sales tax rates here.
This page provides an overview of the sales tax rates and laws in Arizona. If you are a business owner and need to learn more about things like getting a sales tax permit, filing a sales tax return, or making tax-exempt purchases for resale see the Arizona Sales Tax Handbook's Table of Contents above.
What is exempt from sales taxes in Arizona?
Many states have special sales tax rates that apply to the purchase of certain types of goods, or fully exempt them from the sales tax altogether. Here's how Arizona taxes five types of commonly-exempted goods:
For more details on what types of goods are specifically exempt from the Arizona sales tax see Arizona sales tax exemptions. To learn more about what types of transactions are subject to the sales tax to begin with, see what purchases are taxable in Arizona? Taxation of vehicle purchases in particular are discussed in the page about Arizona's sales tax on cars.
Are services subject to sales tax in Arizona?
"Goods" refers to the sale of tangible personal property, which are generally taxable. "Services" refers to the sale of labor or a non-tangible benefit. In Arizona, specified services are taxable.
About the Arizona Sales Tax
The state of Arizona has a slightly complicated sales tax system. The system Arizona utilizes is called the Transaction Privilege Tax, which is also known as the TPT. This tax system is not technically a sales tax system, although they are similar. It is a gross receipts tax, which means that the taxes are levied from the gross receipts of each vendor as opposed to the liability of the buyer (although vedors can pass the TPT on to the buyer, and most do). However, in addition to the TPT, cities and counties have the ability to add various local taxes to the total compounded rate. These local additions may vary significantly depending on which jurisdiction you are in.
It is also worth noting that Indian reservations in the state of Arizona apply their own sales tax, which is usually higher than the average rate.
Is the Arizona Sales Tax Destination-Based or Origin-Based?
Arizona is a origin-based sales tax state, which means sales tax rates are determined by the location of the vendor, not by the location of the buyer. The origin-based method of determining sales tax is less complicated for vendors than destination-based sales tax, because all in-state buyers are charged the same sales tax rate regardless of their location.
Is Arizona a Streamlined Sales Tax State?
Arizona is not a member of the Streamlined Sales and Use Tax Agreement. The SSUTA is an agreement adopted by about half of states that ensures that their sales tax laws are simplified to lower the costs associated with compliance.
Contact the Arizona Department of Revenue
The Arizona Transaction Privilege Tax is administered by the Arizona Department of Revenue. You can learn more by visiting the sales tax information website at www.azdor.gov.
Phone numbers for the Transaction Privilege Tax division of the Department of Revenue are as follows:
- Local Phone: (602) 255-2060
- Toll-Free Phone: (800) 843-7196
Learn More: Our Book Recommendations
If you would like to learn more about how to manage your Arizona sales taxes, we recommend the following books:
Simplify Arizona sales tax compliance! We provide sales tax rate databases for businesses who manage their own sales taxes, and can also connect you with firms that can completely automate the sales tax calculation and filing process. Click here to get more information.
Arizona Sales Tax Rates by Zip Code:
Need an updated list of Arizona sales tax rates for your business? Download our Arizona sales tax database!