Arizona sales tax is a tax added to most purchases at the point of sale

When you buy something in Arizona, the seller adds a tax to your bill. That tax goes to the state and to your city or county. The rate you pay depends on where you are in Arizona — it is not the same everywhere. The state sets a base rate, and then local governments add their own portion on top.

Arizona has no sales tax on groceries, prescription medications, or medical equipment. Most other goods and services are taxed. The combined state and local rate ranges from about 5.6% to over 10%, depending on your location. A $100 purchase might cost $105.60 in one city and $110 or more in another.

Key Takeaways

  • Arizona's state sales tax rate is 5.6%, but your actual rate includes local taxes added by your city or county.
  • Groceries and prescription drugs are not taxed in Arizona, but restaurant meals, prepared foods, and most other purchases are.
  • The combined rate you pay varies by location — Phoenix, Tucson, and smaller towns each have different total rates.
  • Sales tax is collected by the seller and sent to the Arizona Department of Revenue, which distributes it to state and local governments.

Arizona's state rate and how local taxes stack on top

The Arizona state sales tax rate is 5.6%. This is the baseline. On top of that, your city or county adds its own local sales tax. In Phoenix, the city adds 2.3%, bringing the total to 8.1% before any special district taxes. Tucson adds 2.35%, for a total of 7.95%. Smaller towns and rural areas may have lower local rates or none at all.

Some areas also have special district taxes for transit, schools, or other services. These stack on top of the state and local rates. A purchase in central Phoenix might be taxed at 8.1%, but a purchase in a different Phoenix neighborhood with a special district could be 8.6% or higher. The exact rate depends on the specific address where the sale happens.

You can find your exact local rate by entering your zip code on the Arizona Department of Revenue website or by asking the cashier. Most retailers' registers are programmed with the correct rate for their location.

What is and is not taxed in Arizona

Food you buy at a grocery store is not taxed. This includes bread, milk, vegetables, meat, frozen foods, and canned goods. However, prepared foods are taxed. If you buy a sandwich from a deli counter, a rotisserie chicken, or food from a restaurant, you pay sales tax. The difference is whether the food is ready to eat.

Prescription medications are not taxed. Over-the-counter medicines like aspirin or cold medicine are taxed. Medical equipment prescribed by a doctor — such as wheelchairs, diabetic testing supplies, or hearing aids — is generally not taxed, but you may need to show a prescription or doctor's letter.

Clothing and shoes are taxed. Books are taxed. Gasoline is taxed. Haircuts are taxed. Services like plumbing, electrical work, and car repairs are taxed. Digital goods like e-books, music downloads, and streaming subscriptions are taxed. If you are unsure whether something is taxed, ask the seller before you buy.

How sales tax is collected and where the money goes

The seller collects sales tax from you at the register and holds it temporarily. They then send it to the Arizona Department of Revenue, usually monthly or quarterly depending on how much tax they collect. The Department of Revenue keeps the state's portion (5.6%) and distributes the local portion to cities, counties, and special districts based on where each sale occurred.

The state uses its portion for general government operations. Cities and counties use their portion for local services — roads, police, fire, libraries, and other programs. Special district taxes fund specific projects like light rail or school improvements. The breakdown of where your tax dollar goes depends on your location and what local taxes your area has approved.

If a business fails to send in the sales tax it collected, the Arizona Department of Revenue can audit them and pursue collection. Consumers are not responsible for unpaid sales tax if a business fails to remit it — the business is liable.

Sales tax on online and out-of-state purchases

If you buy something online from a retailer that has a physical location in Arizona or ships to Arizona regularly, they must collect Arizona sales tax. This includes large retailers like Amazon, Walmart, and Target. The tax is added to your order based on your delivery address in Arizona.

If you buy from a small out-of-state seller with no Arizona presence, they may not collect Arizona sales tax. However, Arizona law requires you to pay "use tax" on those purchases — it is the same rate as sales tax, and you are supposed to report it on your state income tax return. Most people do not do this, and enforcement is limited, but it is technically your responsibility.

Shipping charges are generally not taxed, but the item itself is. If you return an item and get a refund, the sales tax is refunded as well.

Special situations and exemptions

Businesses that resell items — like retailers and wholesalers — can get a resale certificate from the Arizona Department of Revenue. This allows them to buy items without paying sales tax, since the tax will be collected when the item is sold to the final customer. You cannot use a resale certificate for personal purchases.

Nonprofit organizations may be exempt from sales tax on certain purchases, but they must register with the state and follow specific rules. The exemption does not apply to all purchases — it depends on what the nonprofit is buying and how it will be used.

Native American tribes have different tax rules on tribal land. If you buy something on tribal land, different tax rates or exemptions may apply. This varies by tribe and location.

Frequently Asked Questions

Is Arizona sales tax included in the price shown on the shelf?

No. The price on the shelf or tag does not include sales tax. The tax is added at checkout. This is why a $10 item costs more than $10 when you pay. The total you owe is the price plus the sales tax for your location.

Do I pay sales tax if I buy something out of state and bring it home to Arizona?

If you buy something in another state and bring it to Arizona, you do not pay Arizona sales tax on it. You already paid tax in the state where you bought it. However, if you later sell that item in Arizona, the buyer pays Arizona sales tax.

Can I get a refund of sales tax I already paid?

If you return an item and get a refund, the sales tax is refunded along with the purchase price. If you paid sales tax on something by mistake — for example, the cashier taxed a non-taxable item — you can ask the store for a refund. For larger errors, you may need to contact the Arizona Department of Revenue.

What is the difference between sales tax and use tax?

Sales tax is collected by the seller when you buy something. Use tax is a tax you owe on items you buy from out-of-state sellers who do not collect Arizona tax. It is the same rate as sales tax, and you report it on your state income tax return. Most people do not pay it unless audited.

Do I have to pay sales tax on services?

Most services are taxed in Arizona. Haircuts, car repairs, plumbing, and electrical work are all taxed. Some services are exempt — for example, medical services provided by a doctor or dentist. Ask the service provider whether their work is taxed before you hire them.