Virginia's sales tax rate and what it covers

Virginia charges a sales tax of 5.3 percent on most goods and services you buy in the state. This rate is made up of a 4.3 percent state tax plus a 1 percent local tax that varies slightly by locality — some cities and counties add an extra 0.25 percent, bringing their total to 5.55 percent. When you buy something at a store or online from a Virginia seller, the tax is calculated on the purchase price and added to your receipt.

The tax applies to tangible goods — clothing, electronics, groceries at the register, furniture, and similar items. It also applies to certain services, including repairs, alterations, installation work, and telecommunications. However, not everything is taxed. Prescription medications, unprepared food bought at a grocery store, and certain medical equipment are exempt. Some services like haircuts and dry cleaning are also exempt in Virginia.

Key Takeaways

  • Virginia's base sales tax is 5.3 percent, though some localities charge up to 5.55 percent depending on where you live.
  • The tax applies to most goods and many services, but groceries, prescription drugs, and certain services like haircuts are not taxed.
  • Online purchases from Virginia-based sellers are subject to sales tax; purchases from out-of-state sellers depend on that seller's tax obligations.
  • Businesses collect and send the tax to Virginia's Department of Taxation, not directly to individual localities.

Which localities charge different rates

Most of Virginia operates under the standard 5.3 percent rate. However, a handful of localities have voted to add an extra 0.25 percent local tax, bringing their total to 5.55 percent. These include Arlington County, the City of Alexandria, and Fairfax County, among a few others. The extra revenue from this higher rate typically funds transportation projects or school improvements in those areas.

You can find your exact local rate by entering your address on the Virginia Department of Taxation website or by asking a cashier in your area. The difference between 5.3 and 5.55 percent is small on individual purchases, but it adds up if you live in one of the higher-rate localities.

What is and is not taxed in Virginia

Groceries are not taxed in Virginia — this includes unprepared food like fresh produce, meat, dairy, and packaged items you cook at home. Prepared food, such as restaurant meals, deli items ready to eat, and food from a food truck, is taxed. Prescription medications are also exempt, but over-the-counter medicines and vitamins are taxed.

Clothing and shoes are taxed, with no exemption for children's clothing or any other category. Utilities like electricity and natural gas are not taxed. Services vary: haircuts and dry cleaning are exempt, but repairs to vehicles, appliances, and other goods are taxed. Installation services, labor for construction or home repair, and telecommunications services are all subject to tax.

Digital products like e-books, software, and streaming subscriptions are generally taxed if purchased from a Virginia seller. Gasoline is taxed, but the tax is built into the pump price and does not appear separately on your receipt.

How online purchases are taxed

If you buy something online from a Virginia-based business, sales tax is charged at your delivery address rate. If you buy from an out-of-state seller, whether they charge you tax depends on whether that seller has a legal obligation to collect Virginia tax. Large retailers like Amazon, Walmart, and Target collect Virginia sales tax on all orders shipped to Virginia addresses. Smaller sellers may not, depending on their sales volume and nexus in the state.

You are not responsible for tracking down and paying tax on purchases where the seller did not charge it. The seller is responsible for understanding their tax obligations. If you are buying from a small out-of-state seller and no tax was charged, you do not owe it retroactively.

Who collects and where the money goes

Businesses — retailers, service providers, restaurants, and online sellers — collect sales tax from customers and send it to the Virginia Department of Taxation. The state then distributes the revenue: the 4.3 percent state portion goes to the state budget, and the 1 percent local portion goes to the locality where the sale occurred. If a locality has voted for the extra 0.25 percent, that money stays in that locality.

Businesses file sales tax returns monthly or quarterly, depending on their sales volume. They are responsible for calculating the correct rate for each transaction based on the delivery address or location of the service.

Tax-exempt purchases and who qualifies

Certain organizations and individuals can make purchases without paying sales tax. Nonprofits, schools, and government agencies can obtain a tax-exempt certificate and use it when buying goods for their operations. Religious organizations may also may have access to. If you work for one of these organizations, you cannot use their exemption for personal purchases — the exemption applies only to purchases the organization makes for its own use.

Resellers — businesses that buy goods to resell them — can also obtain a resale certificate so they do not pay tax on inventory. They will collect tax from their customers instead. Individual consumers do not have a general tax exemption; you pay tax on your purchases unless the item itself is exempt.

Frequently Asked Questions

Does Virginia tax groceries?

No. Unprepared food bought at a grocery store — fresh produce, meat, dairy, bread, and packaged items you cook at home — is not taxed. Prepared food like restaurant meals, deli items ready to eat, and food from a food truck is taxed.

What is the sales tax rate where I live?

Most of Virginia is 5.3 percent. Arlington County, Alexandria, and Fairfax County charge 5.55 percent. A few other localities also charge the higher rate. You can confirm your rate by entering your address on the Virginia Department of Taxation website or by asking a local business.

Do I pay sales tax on online purchases?

If you buy from a Virginia-based seller, tax is charged at your delivery address rate. If you buy from an out-of-state seller, tax depends on whether that seller is required to collect Virginia tax. Large retailers collect it; smaller sellers may not. You are not responsible for paying tax the seller did not charge.

Are prescription medications taxed?

No. Prescription medications are exempt from Virginia sales tax. Over-the-counter medicines, vitamins, and supplements are taxed.

Is there a sales tax on services?

Some services are taxed and some are not. Repairs, installation, and telecommunications are taxed. Haircuts, dry cleaning, and certain other personal services are not. The type of service determines whether tax applies.