Kentucky's statewide sales tax is 6 percent
Kentucky charges a 6 percent sales tax on most retail purchases. This is the base rate that applies across the entire state. However, some counties and cities add their own local sales tax on top of the state rate, which means the total tax you pay at checkout can be higher than 6 percent depending on where you shop.
The state collects this tax at the point of sale — when you buy something at a store, restaurant, or online retailer. The merchant collects the tax from you and sends it to the Kentucky Department of Revenue. You do not pay sales tax separately; it is added to your bill before you pay.
Key Takeaways
- Kentucky's base sales tax rate is 6 percent, but local taxes can add 0 to 2.75 percent depending on your county and city.
- Food purchased at grocery stores is not subject to sales tax in Kentucky, but prepared food and restaurant meals are taxed.
- Prescription medications are exempt from sales tax; over-the-counter drugs and vitamins are taxed.
- The total tax you pay varies by location, so a purchase in Louisville may cost more in tax than the same purchase in a smaller town.
How local taxes change your total rate
While the state rate is 6 percent, Kentucky allows counties and cities to impose additional sales taxes. These local rates range from 0 to 2.75 percent, depending on where you live and shop. This means the total sales tax you pay can be anywhere from 6 percent to 8.75 percent.
For example, Jefferson County (which includes Louisville) has a local tax rate of 1.5 percent, bringing the total to 7.5 percent. Other counties have lower or no additional local tax. To find the exact rate in your area, you can check the Kentucky Department of Revenue website or ask a local retailer what tax rate applies to their location.
The local tax is collected by the merchant at the same time as the state tax. You will see the combined total on your receipt, but it is broken down between state and local portions.
What is and is not taxed in Kentucky
Not everything you buy is subject to sales tax in Kentucky. Groceries — food you buy at a supermarket to cook at home — are not taxed. This includes bread, milk, vegetables, meat, and other unprepared food items. However, prepared food and restaurant meals are taxed at the full rate.
Prescription medications are exempt from sales tax when you present a valid prescription. Over-the-counter drugs, vitamins, and supplements are taxed. Clothing and shoes are taxed in Kentucky, unlike some other states that exempt them.
Services are generally not taxed in Kentucky, though there are exceptions. For instance, haircuts and repairs are not taxed, but certain services like pest control or cleaning services may be taxed depending on the specific circumstances. When in doubt, ask the business whether their service is subject to tax.
Sales tax on online purchases
Online retailers are required to collect Kentucky sales tax on purchases shipped to Kentucky addresses, even if the retailer is based outside the state. This applies to most major retailers like Amazon, Walmart, and others. The tax is calculated based on the delivery address, so if you order something to be shipped to a Kentucky address, Kentucky sales tax applies.
Small retailers and marketplaces may have different rules depending on their sales volume and business structure. If you do not see sales tax added to an online purchase being shipped to Kentucky, contact the retailer to clarify whether they are required to collect it. The responsibility to pay tax ultimately falls on the consumer if the retailer does not collect it.
Who collects and where the money goes
Merchants — stores, restaurants, online retailers — collect sales tax from customers and send it to the Kentucky Department of Revenue. The state then distributes the revenue according to state law. A portion goes to the state general fund, and a portion goes back to local governments based on where the tax was collected.
This is why local sales tax rates matter: the local portion of the tax stays in that county or city to fund schools, roads, and other local services. When you shop in a particular location, part of the tax you pay supports that community's budget.
Sales tax on vehicles and special items
Vehicle purchases in Kentucky are subject to sales tax, calculated on the purchase price of the car. The tax rate depends on where the vehicle is registered and titled. If you buy a used car from a private seller, you still owe sales tax when you register it with the Kentucky Transportation Cabinet.
Certain items have special tax treatment. For example, motor fuel is subject to an excise tax in addition to sales tax. Cigarettes and tobacco products are taxed at a higher rate than regular goods. If you are buying something unusual or expensive, ask the retailer whether any special taxes apply.
Frequently Asked Questions
What is the sales tax rate where I live?
Kentucky's base rate is 6 percent, but your total rate depends on your county and city. Check the Kentucky Department of Revenue website and enter your zip code, or call your local tax assessor's office. Retailers in your area can also tell you the exact rate.
Do I have to pay sales tax on groceries?
No. Unprepared food you buy at a grocery store — bread, produce, meat, dairy — is not taxed. Prepared food, restaurant meals, and food from a deli counter are taxed at the full rate.
Is sales tax added to the price shown on the shelf?
No. The price on the shelf or tag does not include sales tax. The tax is calculated and added at checkout. This is why your total bill is higher than the marked price.
Do I owe sales tax on items I buy out of state and bring to Kentucky?
Kentucky does not tax items you already own. However, if you purchase something in another state and have it shipped to Kentucky, Kentucky sales tax applies based on your delivery address.
Are prescription glasses and contacts taxed?
Yes. Eyeglasses, contact lenses, and related items are subject to Kentucky sales tax. Prescription medications are exempt, but medical devices and supplies are generally taxed.