Colorado's statewide sales tax is 2.9 percent, but your actual rate depends on where you shop

Colorado charges a base sales tax of 2.9 percent on most purchases. However, counties and cities add their own taxes on top of that amount, so the total you pay varies by location. A purchase in Denver costs more in tax than the same purchase in a small town in rural Colorado. The combined rate where you live or shop can range from 4 percent to over 8 percent.

Sales tax applies to tangible goods — clothing, groceries, electronics, furniture — but not to services. A haircut is not taxed. A bottle of shampoo is. Food you eat at a restaurant is taxed, but groceries you buy at a store are not (with some exceptions for prepared foods and candy).

Key Takeaways

  • Colorado's state sales tax is 2.9 percent, but counties and cities add local taxes that raise the total to between 4 and 8.5 percent depending on where you are.
  • Denver's combined rate is 7.65 percent; Boulder is 7.6 percent; Colorado Springs is 7.25 percent; and Fort Collins is 7.3 percent.
  • Groceries are not taxed in Colorado, but prepared foods, restaurant meals, and candy are subject to the full local rate.
  • Some counties tax services like repairs and labor, while others do not, so the tax on a plumber's bill depends on your location.

How local taxes stack on top of the state rate

When you buy something in Colorado, you pay the state's 2.9 percent plus a county tax and often a city tax. The county rate varies — some counties charge 1 percent, others charge 3 percent or more. Cities then add their own layer on top of that. The result is that two towns in the same county can have different total rates.

For example, Adams County charges 1 percent county tax. The city of Commerce City adds 2.5 percent on top of that, bringing the total to 2.9 + 1 + 2.5 = 6.4 percent. Meanwhile, the city of Thornton in the same county adds 3.5 percent, making the total 2.9 + 1 + 3.5 = 7.4 percent. A shopper in Thornton pays more tax on the same item than a shopper in Commerce City, even though both are in Adams County.

Sales tax rates in Colorado's largest cities

Denver's combined rate is 7.65 percent. Boulder is 7.6 percent. Colorado Springs is 7.25 percent. Fort Collins is 7.3 percent. Pueblo is 7.4 percent. Littleton is 7.65 percent. Aurora is 7.65 percent. Lakewood is 7.65 percent.

These rates are current but can change if a city or county passes a new tax measure. Some cities hold local elections to raise or lower their sales tax rate, and those changes take effect on the date voters approve them. If you live near a city border, it is worth checking the exact rate where you plan to shop, since the difference between 7.25 and 7.65 percent adds up on large purchases.

What is and is not taxed in Colorado

Groceries — raw food you cook at home — are not taxed. This includes meat, produce, dairy, bread, and canned goods. However, prepared foods are taxed. A rotisserie chicken from a grocery store deli is taxed. A sandwich from a deli counter is taxed. Candy and soda are taxed because they are treated as prepared foods, not groceries.

Restaurant meals are always taxed at the full local rate. Takeout and delivery are taxed the same as eating in. Alcohol — beer, wine, and liquor — is taxed at the regular sales tax rate, plus Colorado also charges a separate excise tax on alcohol that varies by type.

Services are usually not taxed, but Colorado has exceptions. Labor and repairs on tangible goods — a mechanic's labor on your car, a plumber's time to fix a pipe — are generally not taxed. However, some cities and counties do tax services, so check your local rules if you are hiring a contractor.

How to find the exact rate where you shop

The Colorado Department of Revenue publishes a complete list of sales tax rates by city and county on its website. You can search by city name or ZIP code to find the combined rate. The list is updated when cities or counties change their rates, though there is usually a lag of a few weeks before the website reflects a new local measure that voters just passed.

If you are shopping online and the seller is based in Colorado, they must charge you the sales tax rate for your delivery address. If the seller is out of state, Colorado law requires them to charge you Colorado's sales tax if they have "economic nexus" in the state — meaning they do enough business here that they are required to register. Most large online retailers now charge Colorado sales tax on orders shipped to Colorado addresses.

Sales tax on vehicles and large purchases

When you buy a car in Colorado, you pay sales tax on the purchase price. The rate is the combined state and local rate where the vehicle is registered, not where you buy it. If you buy a car in Denver but register it in a county with a lower rate, you pay the lower rate. If you buy it in a low-tax area and register it in Denver, you pay Denver's rate.

Trade-ins reduce the taxable amount. If you buy a car for $20,000 and trade in a vehicle worth $5,000, you pay sales tax only on the $15,000 difference. This applies to cars, motorcycles, and other vehicles registered with the Colorado Department of Motor Vehicles.

Frequently Asked Questions

Do I pay sales tax on online purchases shipped to Colorado?

Yes, if the seller has economic nexus in Colorado — meaning they do enough business in the state to be required to register for sales tax. Most large retailers like Amazon, Walmart, and Target charge Colorado sales tax on orders shipped to Colorado addresses. Smaller sellers may not, but Colorado law requires them to if they meet the threshold.

Is clothing taxed in Colorado?

Yes, clothing is subject to the full local sales tax rate. There is no clothing exemption in Colorado. This includes shoes, accessories, and all apparel.

What if I buy something in one city and use it in another?

You pay the sales tax rate where you make the purchase, not where you use the item. If you buy a shirt in Boulder and wear it in Denver, you paid Boulder's tax rate at the register. You do not owe additional tax to Denver.

Are prescription medications taxed?

No, prescription medications are not subject to Colorado sales tax. Over-the-counter medications and vitamins are taxed, but prescriptions filled by a pharmacist are exempt.

Can I get a refund of sales tax if I return an item?

Yes, if the store accepts the return, they refund the sales tax along with the purchase price. Keep your receipt to show the tax amount if the store does not automatically refund it.