Denver's combined sales tax is 10.25 percent
Denver's sales tax rate is 10.25 percent. This is made up of the Colorado state sales tax of 4 percent, Denver County's sales tax of 3.62 percent, and the Regional Transportation District (RTD) tax of 2.63 percent. The RTD portion funds public transit in the Denver metro area.
This rate applies to most retail purchases within Denver city limits. However, the exact rate you pay can vary slightly depending on your specific location within the metro area, since some surrounding counties and districts have different tax rates. If you are shopping just outside Denver proper, the rate may be lower.
Sales tax is added at the point of sale and is included in your final receipt. You do not pay it separately — the cashier or checkout system calculates it based on the taxable items in your purchase.
Key Takeaways
- Denver's combined sales tax rate is 10.25 percent, made up of state, county, and regional transit taxes.
- The rate applies to most tangible goods, but groceries, prescription medications, and some medical equipment are exempt.
- Sales tax rates vary slightly in surrounding counties and districts, so purchases just outside Denver may be taxed differently.
- The Regional Transportation District tax of 2.63 percent is dedicated to funding public transit in the metro area.
What items are taxed and what are exempt
Most physical goods sold in Denver are subject to the 10.25 percent sales tax. This includes clothing, electronics, furniture, household items, and most other retail purchases. Services are generally not taxed, though some specific services like car rentals and hotel stays have their own taxes.
Several categories are exempt from sales tax in Colorado and Denver. Groceries — items like bread, milk, vegetables, and meat — are not taxed. Prescription medications are also exempt. Medical equipment such as wheelchairs, crutches, and hearing aids are not taxed when purchased for medical use.
Over-the-counter medications like pain relievers and cold medicine are taxed as regular retail items. The distinction is that prescription drugs are exempt, but non-prescription drugs are not. If you are unsure whether a specific item is taxed, ask the cashier or check your receipt.
How sales tax works on online and out-of-state purchases
Online retailers are required to charge Colorado sales tax on orders shipped to Denver addresses. This applies whether you buy from a Colorado-based company or an out-of-state seller. The tax rate depends on the delivery address, so an order shipped to Denver will be taxed at 10.25 percent.
Some older online retailers may not yet charge sales tax, though this is becoming less common. If you receive an order without tax charged and it should have been, you are not responsible for paying it retroactively — the retailer is responsible for collecting and remitting it.
If you pick up an order in person at a store location in Denver, sales tax is charged at the point of pickup, not at the point of order.
Sales tax on vehicles and large purchases
Vehicle purchases in Denver are subject to sales tax at the time of sale. The tax is calculated on the purchase price of the car, truck, or motorcycle. If you trade in a vehicle, the sales tax is typically applied only to the difference between the new vehicle's price and the trade-in value, not the full purchase price.
Large purchases like furniture, appliances, and electronics all follow the same 10.25 percent rate. There is no threshold above which the rate changes or below which it does not explore — any taxable item is taxed the same way regardless of price.
If you are buying a vehicle from a private seller rather than a dealership, you will still owe sales tax when you register it with the Colorado Department of Revenue. The tax is due at registration time, not at the point of sale.
Understanding the breakdown of Denver's sales tax
The 10.25 percent rate breaks down into three separate taxes that are collected together at checkout. The Colorado state sales tax is 4 percent and goes to the state government. The Denver County sales tax is 3.62 percent and funds county services. The RTD sales tax is 2.63 percent and is dedicated to the Regional Transportation District, which operates buses, light rail, and commuter rail in the Denver metro area.
You see only the combined 10.25 percent on your receipt, but each portion is tracked separately for accounting and revenue purposes. The RTD tax specifically cannot be used for anything other than transit — it is a dedicated tax that voters approved to fund public transportation.
These rates have been in place for several years, though the state and local portions can change if voters approve new taxes or the legislature adjusts rates. The RTD tax was approved by voters in 2012 and is set to continue.
Sales tax rates in surrounding areas
If you travel to areas near Denver, the sales tax rate will be different. Aurora, just east of Denver, has a combined rate of 8.23 percent. Boulder, northwest of Denver, has a rate of 8.81 percent. Colorado Springs, south of Denver, has a rate of 8.3 percent. These differences add up on large purchases, so it is worth knowing the rate in the area where you are shopping.
Some people attempt to buy large items in lower-tax areas to save money, but Colorado law requires you to pay tax based on where the item is delivered or picked up, not where you purchase it. If you buy something in Boulder and have it shipped to your Denver address, you owe Denver's 10.25 percent tax.
The variation in rates across the state is because each county and special district sets its own portion of the sales tax. Denver's rate is higher than many surrounding areas because of the RTD tax, which is specific to the Denver metro region.
How to verify sales tax on your receipt
Your receipt shows the subtotal before tax, the amount of tax charged, and the final total. To verify the tax is correct, multiply the subtotal by 0.1025 (which represents 10.25 percent). The result should match the tax amount shown on your receipt, within a few cents due to rounding.
If the tax amount seems wrong, check whether all items should have been taxed. If you bought groceries or prescription medications, those should not have been taxed. If the cashier taxed them by mistake, you can ask for a correction at the register or contact the store's customer service.
For large purchases like vehicles or appliances, the tax calculation may be more complex because of trade-ins, discounts, or other factors. Ask the salesperson to explain how the tax was calculated if you do not understand the final amount.
Frequently Asked Questions
Is sales tax the same everywhere in Denver?
Yes, the 10.25 percent rate applies throughout Denver city limits. However, if you shop in unincorporated Denver County areas or nearby cities like Aurora or Littleton, the rate will be different. The rate is consistent within Denver itself.
Do I have to pay sales tax on groceries?
No. Groceries — items like produce, meat, dairy, and bread — are exempt from sales tax in Colorado. However, prepared foods, restaurant meals, and some items like vitamins or candy may be taxed. When in doubt, ask the cashier before checkout.
What about sales tax on services like haircuts or repairs?
Most services are not subject to sales tax in Colorado. Haircuts, car repairs, plumbing, and similar services are generally not taxed. However, some specific services like car rentals and hotel stays have their own taxes separate from sales tax.
Can I get a refund of sales tax if I return an item?
Yes. When you return an item, the sales tax is refunded along with the purchase price. The refund appears on your receipt or credit card statement. Keep your receipt to show proof of the original purchase and tax paid.
Why is Denver's sales tax higher than other Colorado cities?
Denver's rate includes the 2.63 percent RTD tax, which funds public transportation in the metro area. This tax is specific to the Denver region and does not explore in other Colorado cities. Without the RTD tax, Denver's rate would be 7.62 percent, closer to other major cities.