Arizona's sales tax rate and what it covers
Arizona's statewide sales tax is 5.6 percent. When you buy something in a store or online, that 5.6 percent gets added to the price at checkout. However, the total tax you actually pay is usually higher because cities and counties add their own local sales taxes on top of the state rate.
The combined rate depends on where you live or shop. In Phoenix, for example, the total is 8.6 percent. In Tucson it is 8.1 percent. A small town might have a combined rate of 6.5 percent. The state collects its 5.6 percent, and the rest goes to the city or county where the sale happens.
Not everything is taxed at the same rate. Groceries — unprepared food you cook at home — are taxed at a lower rate of 2 percent instead of the full 5.6 percent. Prepared food, restaurant meals, and food you eat on the premises are taxed at the full rate. Prescription medications are not taxed at all.
Key Takeaways
- Arizona's state sales tax is 5.6 percent, but your actual tax rate is higher because your city or county adds a local tax on top.
- Groceries are taxed at 2 percent, while restaurant meals and prepared foods are taxed at the full combined rate.
- Prescription medications have no sales tax, but over-the-counter drugs and vitamins are taxed normally.
- Online purchases from out-of-state sellers are subject to Arizona sales tax if the seller has a physical presence or meets certain sales thresholds in the state.
How local taxes add to the state rate
Every Arizona city and county sets its own local sales tax rate. These rates range from less than 1 percent to around 3.5 percent depending on the location. When you make a purchase, the state collects 5.6 percent and sends it to the state treasury. The local portion goes to the city or county government.
The combined rate is what appears on your receipt. If you shop in different Arizona cities, you will see different totals. A purchase in Flagstaff (combined rate 8.6 percent) will cost more in tax than the same item in a smaller community with a lower local rate. Some counties have higher rates than others, and some cities within the same county have different rates depending on local tax measures they have passed.
You can find your exact local rate by entering your zip code on the Arizona Department of Revenue website or by checking your most recent receipt. The receipt always shows the combined rate that was applied to your purchase.
What is and is not taxed
Most goods and services are subject to sales tax in Arizona. Clothing, electronics, furniture, gasoline, and household items all get taxed. Services like haircuts, car repairs, and plumbing are taxed. Utilities like electricity and water are not subject to sales tax — they have their own separate charges.
Groceries are the biggest exception. Unprepared food — meat, vegetables, bread, milk, eggs, canned goods — is taxed at 2 percent. The moment that food is prepared or ready to eat, the full rate applies. A rotisserie chicken from the grocery store deli is taxed at the full rate. A sandwich from a restaurant is taxed at the full rate. A frozen pizza you cook at home is taxed at 2 percent.
Prescription medications are completely exempt from sales tax. Over-the-counter medications like pain relievers, cold medicine, and allergy pills are taxed normally. Vitamins and supplements are also taxed. Medical equipment like wheelchairs and diabetic supplies may be exempt depending on the item — your pharmacist or doctor can tell you whether a specific item is taxed.
Online and out-of-state purchases
If you order something online from an out-of-state company, Arizona sales tax still applies in most cases. Large online retailers like Amazon, Walmart, and Target have a physical presence in Arizona or meet the state's sales thresholds, so they collect and send Arizona sales tax to the state. The tax rate that applies is the rate for your delivery address.
Smaller online sellers who do not have a warehouse or office in Arizona may not collect Arizona sales tax at checkout. However, Arizona law requires you to pay what is called use tax on those purchases. Use tax is the same rate as sales tax and is meant to level the playing field between local stores and out-of-state sellers. Most people do not pay use tax because it is not automatically collected, but technically it is owed.
If you are a business owner or high-volume buyer, you should understand use tax rules. For personal purchases, the practical reality is that most large retailers already collect the tax, and smaller sellers often do not — but the law says the tax is owed either way.
Sales tax on specific items and situations
Vehicles are taxed differently than regular purchases. When you buy a car in Arizona, sales tax is calculated on the purchase price and collected at the time of registration with the Arizona Department of Transportation. The rate is the combined state and local rate for the county where you register the vehicle, not where you bought it. If you buy a car in Maricopa County but register it in Pima County, you pay Pima County's rate.
Clothing and shoes are fully taxable with no special rate. There is no "back-to-school" exemption or clothing holiday in Arizona. Diapers and feminine hygiene products are taxed normally. Gifts are taxed the same way as any other purchase — the tax is based on what you buy, not on the fact that it is a gift.
Alcohol is subject to sales tax plus additional excise taxes. Beer, wine, and spirits all have sales tax applied, and then the state and federal government add their own per-unit taxes on top. The total cost is higher than the base price plus sales tax alone.
How to find your local sales tax rate
Your receipt is the fastest way to see what you paid. The receipt shows the combined rate that was applied to your purchase. If you need to know your rate before shopping, the Arizona Department of Revenue has a sales tax rate lookup tool on its website where you can enter your zip code and see the exact combined rate.
You can also call your city or county tax assessor's office. They can tell you the local rate for your area and explain any recent changes. Rates do change occasionally when cities or counties pass new tax measures, so if you have not checked in a while, it is worth verifying.
If you are a business owner collecting sales tax, you need to register with the Arizona Department of Revenue and file monthly or quarterly returns depending on your sales volume. The department provides detailed guidance on what to collect, when to file, and where to send the money.
Frequently Asked Questions
Why is Arizona's sales tax different in different cities?
Arizona allows cities and counties to set their own local sales tax rates on top of the 5.6 percent state rate. Each city and county decides how much local tax to charge based on their budget needs and what voters approve. This is why Phoenix, Tucson, and smaller towns all have different combined rates.
Do I have to pay sales tax on groceries?
Unprepared groceries are taxed at 2 percent instead of the full rate. This includes raw meat, fresh produce, bread, milk, and canned goods. Prepared foods like rotisserie chicken, deli sandwiches, and restaurant meals are taxed at the full combined rate.
Is sales tax added to the price shown in the store?
Yes. The price on the shelf or tag does not include sales tax. The tax is added at checkout. Your final receipt will show the subtotal, the tax amount, and the total you owe.
What is use tax and do I have to pay it?
Use tax is owed on purchases from out-of-state sellers who do not collect Arizona sales tax. It is the same rate as sales tax. Most people do not pay it because it is not automatically collected, but Arizona law says it is owed. Large online retailers already collect it, so most personal shoppers do not encounter this issue.
Are there any sales tax holidays in Arizona?
Arizona does not have statewide sales tax holidays for back-to-school, holidays, or other events. Some other states offer these, but Arizona does not. Sales tax applies to all taxable purchases year-round at the same rate.