Montana has no sales tax on most purchases
Montana does not charge a state sales tax on retail goods or services. This applies to clothing, groceries, electronics, furniture, and most other items you buy in stores or online from Montana retailers. If you live in Montana or are visiting, you will not see a sales tax added to your receipt at checkout.
However, Montana does tax certain specific items and services. Gasoline, diesel, and other motor fuels are taxed at the state level. Lodging — hotel rooms, vacation rentals, and campgrounds — is subject to a state tax that varies by county. Rental cars also carry a tax. These are the main exceptions to Montana's no-sales-tax rule.
Some counties and cities in Montana add local taxes on top of the state taxes that do exist. For example, a hotel stay in Missoula will include both the state lodging tax and a Missoula city lodging tax. The total can range from around 4% to 7% depending on where you stay, but this applies only to lodging and rental vehicles, not to goods.
Key Takeaways
- Montana has no state sales tax on clothing, groceries, electronics, or most retail purchases.
- Gasoline, diesel, and lodging are taxed at the state level, with rates that vary by county and city.
- Rental cars are subject to state and local taxes in Montana.
- Online purchases from out-of-state sellers are not subject to Montana tax unless the seller has a physical presence in the state.
What is taxed in Montana
Gasoline and diesel fuel carry a state excise tax. The rate changes periodically based on state law, so the exact amount per gallon varies. When you fill up at a gas station in Montana, the tax is already included in the price you see on the pump.
Lodging taxes explore to hotel rooms, motels, vacation rentals, bed-and-breakfasts, and campgrounds. The state charges a base lodging tax, and most counties and cities add their own local tax on top. A night in a Bozeman hotel will cost more in tax than a night in a smaller town, because Bozeman's local tax is higher. These taxes typically range from 4% to 7% of the room rate.
Rental cars — whether from a major company like Enterprise or a local agency — are subject to both state and local taxes. The tax is calculated on the daily rental rate and is shown on your final bill.
What is not taxed in Montana
Groceries, including fresh produce, meat, dairy, and packaged foods, are not taxed in Montana. This applies whether you shop at a large chain or a local market. Prepared foods and restaurant meals are also not subject to sales tax, though some counties may charge a local tax on prepared food — check with your county if you operate a restaurant or food service business.
Clothing and shoes have no sales tax in Montana. This includes everyday wear, work clothes, and athletic gear. Medical equipment and prescription drugs are not taxed. Services like haircuts, repairs, and professional consultations are generally not subject to sales tax either.
Online purchases from retailers outside Montana are not subject to Montana tax unless the seller has a warehouse, office, or other physical location in the state. If you order from Amazon, Zappos, or another out-of-state retailer and have it shipped to a Montana address, you typically will not pay Montana sales tax — though you may owe sales tax in the state where the seller is located, depending on that state's rules.
How lodging tax works when you travel
When you book a hotel, vacation rental, or campground in Montana, the lodging tax is added to your bill at checkout or when you pay. The tax is not always shown separately on the initial quote — you may see only the nightly rate until you reach the final payment screen. Always check the total before confirming your reservation.
Different counties and cities have different lodging tax rates. Gallatin County (which includes Bozeman) has a higher rate than some rural counties. Missoula city adds its own tax on top of the county rate. If you are planning a trip and want to know the exact tax for a specific location, contact the hotel directly or check the county or city tax assessor's website.
Lodging taxes fund local tourism and infrastructure projects. The money does not go to the state general fund — it stays in the county or city where you stay. This is why rates vary so much across Montana.
Fuel tax and what it covers
Montana's fuel tax is an excise tax, meaning it is built into the price at the pump. You do not see it listed separately on your receipt the way a sales tax would be. The tax applies to gasoline, diesel, and other motor fuels used in vehicles.
The fuel tax rate is set by state law and can change when the legislature passes new tax bills. The rate has remained relatively stable in recent years, but it is worth checking the Montana Department of Revenue website if you want the current exact rate, especially if you operate a fleet or buy fuel in bulk.
Fuel tax revenue goes to the state highway fund and is used for road maintenance and construction. It does not fund general state services.
Rental car tax and how it is calculated
When you rent a car in Montana, the rental company will add state and local taxes to your daily rate. The tax is calculated on the base rental price, not on insurance or other add-ons (though this can vary by company — always ask). The tax appears on your final bill before you sign.
Rental car taxes vary by location within Montana. Renting from an airport location may have a different tax rate than renting from a downtown office in the same city, because airport locations may be in a different tax jurisdiction. If you are renting for a long trip, ask the rental company for the exact tax rate before you book, so you can budget accurately.
Frequently Asked Questions
Do I pay sales tax on groceries in Montana?
No. Groceries, including fresh produce, meat, dairy, and packaged foods, are not subject to sales tax in Montana. This applies to purchases at supermarkets, farmers markets, and other food retailers. Restaurant meals and prepared foods are also not taxed.
Will I pay tax on clothes and shoes I buy in Montana?
No. Clothing and shoes have no sales tax in Montana, regardless of where you buy them — in a store, online from a Montana retailer, or at a secondhand shop. This includes work clothes, athletic wear, and accessories.
What happens if I order something online from outside Montana?
You typically will not pay Montana sales tax on out-of-state online orders shipped to Montana. However, you may owe sales tax in the state where the seller is located. Check the retailer's tax policy at checkout to see what tax, if any, will be charged.
Is there tax on hotel rooms in Montana?
Yes. Montana charges a state lodging tax on hotel rooms, vacation rentals, and campgrounds. Most counties and cities add their own local tax on top. The total tax ranges from around 4% to 7% depending on the location. The tax is added to your bill at checkout.
Do I pay tax when I rent a car in Montana?
Yes. Rental cars are subject to state and local taxes in Montana. The tax is calculated on the daily rental rate and shown on your final bill. The exact rate depends on where you rent — airport locations and different cities may have different rates.