Exemptions from Sales Tax in Utah
In Utah, certain items may be exempt from the sales tax. Examples of items exempt from Utah sales tax are prescription medications, items used in agricultural processes, fuels, medical equipment, or items used in manufacturing.
Sales Tax Rates in Utah
The Utah sales tax rate is 5.95% as of 2023, with some cities and counties adding a local sales tax on top of the state sales tax.
Sales Tax Collection in Utah
If your business sells physical products or certain types of services in Utah, you will need to collect and pay sales tax. Goods subject to sales tax in Utah include physical property, like furniture, home appliances, and motor vehicles. Prescription medicine and gasoline are tax-exempt. Utah charges a 3% reduced rate on groceries.
You are not required to collect and remit Utah sales tax unless you have a significant business presence or nexus in the state. Utah has a 4.85% statewide sales tax rate. In addition, local sales taxes ranging from 0.25% up to 1.60% may apply. Total combined sales tax rates range from 4.85% to 8.35%.
The requirement to collect Utah sales tax depends on having a connection or nexus with the state that establishes whether Utah can legally compel your business to collect, pay, and remit sales tax.