Vermont state seal

VermontSales Tax

A Complete Guide For Businesses

State Rate
6%

Local Tax
yes

State Portal
Department of Taxes

Phone
(802) 828-2551

General requirements

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

  • Sales tax is charged on the retail sales of tangible personal property (TPP) unless exempt
  • 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 Vermont sales and use tax is 6%.

Some localities charge a 1% local option tax.

How food is taxed

Food, food products and beverages are exempt from Vermont sales tax with the exception of soft drinks and food and beverages sold in vending machines.

Prepared and restaurant meals are taxed at a rate of 9% (meals and rooms tax).

Nexus in Vermont

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

  • Maintains a business location in Vermont, including any kind of office
  • Engages in the regular, systematic, or seasonal solicitation of sales in the state by advertisement, mail, compter database, etc
  • Has employees who solicit and accept orders in Vermont

Online activities that establish nexus in Vermont include:

  • Having an affiliate or referral relationship with a contractor or representative in the state
  • Sales from these referrals exceed $10,000 in the previous year

Filing schedule

The Department of Taxes will determine whether you file monthly, quarterly, or annually.

Returns are due on the 25th of the month after the filing period ends.

Registering to collect sales tax in Vermont

You must register for your business tax account and license prior to collecting sales tax. Registration is free. Your Vermont Sales and Use Tax license must be displayed so that it’s visible to customers.

Penalties

Taxes paid after the due date of the return accrue interest and late payment penalties.

The penalty is 5% per month with a maximum penalty of 25% of taxes due.

Interest is charged based on a rate set annually by the Department.