The base sales tax rate in Arizona is 5.6% and this applies to the whole state. However; the rate you will likely pay or have to collect may be different since there are a variety of different sales tax rates depending on the county your business is or will be located in, or where your customers are having their orders shipped to. Sales tax in Arizona is slightly different from other states, the state refers to the taxes that business owners are responsible to collect and convey to the Department of Revenue as “transaction privilege tax” and “use tax”, it still does serve the same purpose as “sales and use tax” however.
So, the way Arizona’s sales tax is calculated is the base rate of 5.6% throughout the whole state plus the additional percentage rate each county, town, or district imposes, equals the total Arizona sales tax rate you will pay as a consumer or have to collect from your customers if you are a business. The sales and use tax rate in a specific Arizona location has three parts: the state tax rate (transaction privilege tax), the local tax rate, and any district tax rate that may be in effect.
Arizona Sales Tax Rate = 5.6%
Any retail, gas station/convenience store or restaurant-related business you visit in Arizona should charge you the prevailing rate of Arizona’s sales tax according to the county they are located in. While paying sales tax is mostly applicable to the sale of products, it may also apply to some service-related businesses such as hotels, taxi and limo services, sale of admissions, and charges for participation in games and amusement activities. If you are unsure whether your business should collect Arizona sales tax, you may want to visit the Arizona Department of Revenue website.
Paying Arizona’s sales tax as a consumer is a seamless process that you do not need to worry too much about when visiting a restaurant or retail store or taking your car in for a service. On the other hand, as a business owner or someone looking to start a business in Arizona, it is a whole different matter. If you are responsible for collecting sales tax from your customers, you need to know exactly what your responsibilities are, where you need to remit your businesses collected sales tax to, and you need to follow the rules of Arizona sales tax collection, making sure you pay the State of Arizona periodically for the total amount of Arizona sales tax you collect.
In some instances, this may apply to online businesses, and if you participate in the Amazon FBA program or having an online business with a lot of your sales taking place in Arizona, you may be subject to sales tax collection depending on where your products are warehoused and the volume of your annual transactions.
Arizona Sales Tax Rate
The base rate of sales tax in Arizona is 5.6%, but the range of Arizona sales tax, including the county, town, or district sales tax rates is approximately 5.6%-11.2%. For your convenience, we have included a table (below) that lists the Arizona sales tax rate for each county within the state. The table combines the base rate of 5.6% and the local county rate to give you a total tax rate for each county. Where the sales tax rates get higher than what you see in the table for specific counties is dependent on the type of product/service you are being taxed for. As an example, telecommunication services in Phoenix, AZ drive the sales tax rate up to 11%, and short-term motor vehicle rentals are as high as 10.6% sales tax.
Arizona has a few different counties, 15 in total. The Arizona sales tax rate for most counties is 0.5%-1.0%, which means that most counties, when combined with Arizona’s sales tax rate, charge a total of 6.1%-6.6% sales tax.
What you will find in the U.S., which is different from some other countries, is that when you see the price of a product such as a t-shirt in a retail store, or food on a menu in a restaurant, it is usually plus state and county sales tax.
So, when you checkout your items in a store or request the bill at a restaurant, you will likely pay the price you saw on the label or menu + state and county sales tax. This often takes foreigners and those not used to this system by surprise because, in many other countries, the price you see is the price you pay, and the price quoted includes any sales tax or value-added tax (VAT).
Example of Arizona Sales Tax in Phoenix
To get a basic understanding of how Arizona imposes a state and county sales and use tax on most products and some services purchased in the state you can make a quick calculation of the amount of Arizona sales tax you will pay based on the product price and sales tax rate charged within the county you are purchasing from.
So, if you are going out for a meal in Maricopa County, the sales tax rate is 0.7%. Typically, you would add this to the base rate of Arizona sales tax of 5.6% and you would expect to pay a total of 6.3%. Since you are also in Phoenix, there is an additional sales tax of 2.3%. So you pay 5.6% + 0.7% + 2.3% = 8.6%. So, when you spend $150 in a Phoenix, AZ restaurant, and ask for the check (bill), expect to see a further 8.6% added, making your total bill $162.90 ($12.90 in Arizona sales tax). Also, don’t forget, you should tip on top of this!
State of Arizona Sales Tax for Businesses
As a business owner selling taxable goods or services, you act as an agent of the state of Arizona by collecting tax from purchasers and passing it along to the Arizona Department of Revenue. You must note that any sales tax (transaction privilege tax) collected from residents belongs to the Department of Revenue, so, it is entirely your responsibility as a business owner who collects sales tax to manage the amount of tax you collect and convey to the Arizona Department of Revenue to avoid any penalties and accumulative interest.
There is specific terminology surrounding whether, as a business, you need to collect Arizona sales tax. This is called “Sales Tax Nexus.” It basically means, does your business have a “significant presence” in the state. It used to be that sales tax nexus only applied to businesses with a physical presence in the state, such as having employees, an office or warehouse, or retail store.
Any of the following criteria may be considered by the state of Arizona as qualifying a seller/business to have sales tax nexus:
- If your business operates in a physical building such as an office or other place of business.
- If your business has an employee present in the state for more than 2 days per year.
- If your business stores goods/products in a warehouse.
- Ownership of real or personal property.
- If your business delivers merchandise in Arizona using vehicles owned by the taxpayer.
- Independent contractors or other representatives in Arizona for over 2 days per year.
To learn exactly what the Arizona Department of Revenue determines to be sales tax nexus in Arizona, head over to their website and see what businesses this applies to and what Arizona sales tax you are expected to collect from your customers.
Arizona, unlike most other states, has adopted a unique way of determining its sales tax (transaction privilege tax) rates within the state. Most states will have a base sales tax rate, and then each county within the state will then charge additional sales tax, which added to the base state sales tax rate will equal the rate within that specific area (county or city).
However, it doesn’t work exactly like this in Arizona, the sales tax is more confusing due to Arizona sales tax being imposed at either city/county/school/transportation and SPD (special purpose district) levels. This means that the variations of Sales tax in Arizona range further than just the state sales tax and then individual county sales tax added together. There is a lot more to consider when working out what the correct sales tax is for your business within a certain area or industry within the state.
Check out the Avalara website that gives you the specific breakdown of various Arizona sales tax rates, not just for counties, but for cities and towns in Arizona. The rates you see below will often be higher than the flat-rate sales tax charges per county because each city and town charges more which drives up the overall Arizona sales tax based on the zip code you are located in. You can also visit the Arizona Transaction Privilege & Use Tax Rate Look Up page that allows you to enter a street address, city, and zip code to determine the exact tax jurisdiction and reporting criteria.
The table below lists the 15 Arizona counties that charge sales tax within the state. Arizona’s sales tax is based on the base rate plus the county/district rate, so the rates below are indicative of the total Arizona sales tax you will pay or have to collect from your customers.
|Arizona Sales Tax Rates by County||Total Arizona Sales Tax Rate||Arizona State Sales Tax Rate|
|Apache County Sales Tax||6.1%||5.6%|
|Cochise County Sales Tax||6.1%||5.6%|
|Coconino County Sales Tax||6.9%||5.6%|
|Gila County Sales Tax||6.6%||5.6%|
|Graham County Sales Tax||6.6%||5.6%|
|Greenlee County Sales Tax||6.1%||5.6%|
|La Paz County Sales Tax||7.6%||5.6%|
|Maricopa County Sales Tax||6.3%||5.6%|
|Mohave County Sales Tax||5.6%||5.6%|
|Navajo County Sales Tax||6.43%||5.6%|
|Pima County Sales Tax||6.1%||5.6%|
|Pinal County Sales Tax||7.2%||5.6%|
|Santa Cruz County Sales Tax||6.6%||5.6%|
|Yavapai County Sales Tax||6.35%||5.6%|
|Yuma County Sales Tax||6.71%||5.6%|
Arizona Department of Revenue Contact Details
Most communication with the Arizona Department of Revenue can be conducted through their online services which are available 24/7, or via telephone which is possible between the hours of 8:00 am – 5 pm (Mountain Time) Monday through Friday (except US holidays). Here are the main contact methods:
Here is the main address for the Arizona Department of Revenue:
Arizona Department of Revenue
ATTN: Customer Care
P.O. Box 29086
Phoenix, AZ 85038-9086 United States
Phone Number: (602) 255-3381 (if calling from outside the U.S., dial 001-602-255-3381)
Toll-free from within Arizona: (800) 352-4090
If you would like to email the Arizona Department of Revenue, you must specifically find the email address on the website for the department you would like to contact. They can also be contacted on Twitter and Facebook