Ohio: Sales Tax Handbook
What purchases are taxable in Ohio?
The taxability of various transactions (like services and shipping) can vary from state to state, as do policies on subjects such as whether excise taxes or installation fees included in the purchase price are also subject sales tax. This reference is here to help answer your questions about what is and is not subject to the Ohio sales tax.
Contents1.) Taxability of Goods and Services
- General Ohio taxability guidelines
- Are services subject to sales tax?
- Is shipping & handling subject to sales tax?
- Are drop shipped items taxable?
Section 1: Taxability of Goods and Services
What transactions are generally subject to sales tax in Ohio?
In the state of Ohio, sales tax is legally required to be collected from all tangible, physical products being sold to a consumer, with the exception of certain building materials, prescription drugs and groceries.
This means that an individual in the state of Ohio who sells school supplies and books would be required to charge sales tax, but an individual who owns a store which sells groceries is not required to charge sales tax on all of its products.
Are services subject to sales tax in Ohio?
Services in Ohio are not taxable and the same applies to plumbers and freelancers. You will have to part with sales tax if the services provided encompass creating or manufacturing products
You can find a table describing the taxability of common types of services later on this page.Top
Are shipping & handling subject to sales tax in Ohio?
Ohio usually considers shipping charge as part of the piece of item and is therefore taxable. Therefore if you are a seller you should consider charging sales tax on the price of every item. In the case where the item you are shipping is not taxable then you shouldnÃƒÂ¢Ã¢â€šÂ¬Ã¢â€žÂ¢t charge sales tax on the shipping price of the item. If you have a combination of both taxed and untaxed items then you should charge taxes on goods that are tax related.Top
Are drop shipments subject to sales tax in Ohio?
"Drop shipping" refers to the common business practice in which a vendor, often in a different state, makes a sale of a product which is shipped to the end-user by a third party supplier hired by the initial vendor. In Ohio, drop shipments are generally subject to state sales taxes.
Section 2: Taxability of Various Items in Ohio
This table shows the taxability of various goods and services in Ohio. If you are interested in the sales tax on vehicle sales, see the car sales tax page instead. Scroll to view the full table, and click any category for more details.
|Products on Amazon.com||TAXABLE *|
|General Clothing||TAXABLE *|
|Food and Meals|
|Grocery Food||EXEMPT *|
|Leases and Rentals|
|Tangible Media Property||TAXABLE|
|Manufacturing and Machinery|
|Raw Materials||EXEMPT *|
|Utilities & Fuel||EXEMPT|
|Medical Goods and Services|
|Medical Devices||EXEMPT *|
|Medical Services||EXEMPT *|
|Newspapers and Magazines|
|General Occasional Sales||EXEMPT *|
|Motor Vehicles||TAXABLE *|
|Optional Maintenance Contracts|
|General Optional Maintenance Contracts||TAXABLE|
|Parts Purchased for Use in Performing Service Under Optional Maintenance Contracts||EXEMPT|
|Pollution Control Equipment|
|General Pollution Control Equipment||TAXABLE *|
|Transportation Services||TAXABLE *|
|Software and Digital Products|
|Canned Software - Delivered on Tangible Media||TAXABLE|
|Canned Software - Downloaded||TAXABLE|
|Custom Software - Delivered on Tangible Media||TAXABLE *|
|Custom Software - Downloaded||EXEMPT *|
|Customization of Canned Software||TAXABLE *|
|Digital Products||TAXABLE *|
|General Trade-Ins||TAXABLE *|
|Vending Machine Sales|
* See notes in category taxability page for details
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