What Is Not Taxed in Utah?

Taxation in Utah

Groceries are taxed in Utah at a reduced rate of 3%, including a 1.75% state tax and 1.25% local taxes. Alcohol and prepared foods are taxed at the full 4.85% state rate plus local taxes. Counties may impose a 1% tourism tax on restaurants.

Income Tax and Property Tax

Utah has a flat 4.95% personal income tax rate. Supplemental income can be taxed up to 40%. The state has an average property tax rate of 0.58%, with homeowners typically paying about $1,900 annually.

Tax Exemptions and Government Actions

Utah exempts food, prescription medications, and medical devices from sales tax. The state ranks 8th in business tax climate and collects revenue through income, sales, property, and other taxes.

Utah lawmakers may eliminate the 1.75% state tax on groceries if voters remove a requirement that income taxes mainly fund education. Lawmakers previously explored raising the gas tax for schools, but the measure failed.

Social Security Taxation

Social Security benefits are taxed in Utah to the same extent as federal. The state uses the federal formula to calculate taxable Social Security income.

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