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MassachusettsSales Tax

A Complete Guide For Businesses

State Rate
6.25%

Local Tax
no

State Portal
Department of Revenue

Phone
(617) 887-6367

General requirements

Massachusetts is a destination-based state (sales are taxed where the buyer is located).

  • Sales tax is charged on the sales price or rental charge of tangible personal property (TPP)
  • For manufacturers, purchases used for production aren’t taxed
  • For distributors, items purchased for resale aren’t taxed

Businesses may file in the following ways:

Rates

The state sales tax is 6.25% with no additional local or county sales tax.

How food is taxed

Most unprepared food items are exempt from the sales tax, while restaurant meals are fully taxable.

Nexus in Massachusetts

A business is considered to have established a tax presence in the state if it:

  • Maintains a business location in Massachusetts
  • Employs labor
  • Owns property
  • Executes contracts or enforces contract rights
  • Has representatives who install, assemble, or service products
  • Broadly, “rents, leases, buys, sells, or procures services or tangible property”

Find more information about nexus in Massachusetts.

Filing schedule

Payment and returns are due within 20 days after the end of the filing period.

Filing frequency is determined by the amount of tax collected as follows:

  • Annual Filers: $100 or less
  • Quarterly Filers: from $101 up to $1,200
  • Monthly Filers: $1,200 or more

Registering to collect sales tax in Massachusetts

Register online for a Sales and Use Tax Registration Certificate (Form ST-1) for each business location. The form must be displayed on the business premises and be visible to customers.

Penalties

Penalties charged for missing the due dates are as follows:

  • Late payment: 1% of the unpaid tax shown on the return per month, up to a maximum of 25%
  • Late filing: 1% of the balance due per month, up to a maximum of 25%

You'll also be charged interest at the federal short-term rate (which can change quarterly) plus 4%, compounded daily.