RETAIL SALES AND USE TAX
In general, all sales, leases, and rentals of tangible personal property in or for use in Virginia, as well as accommodations and certain taxable services, are subject to Virginia sales and use tax, unless an exemption or exception is established.
SALES TAX RATES
The sales tax rate for most locations in Virginia is 5.3%. Three areas have an additional regional tax as outlined below. In all of Virginia, food for home consumption (e.g. grocery items) is taxed at a reduced rate of 2.5%. Beginning January 1, 2020, certain essential personal hygiene items will also be taxed at the reduced rate.
|Hampton Roads||Northern Virginia||Historic Triangle||Everywhere Else|
|General Sales Tax Rate||6%||6%||7%||5.3%|
- Hampton Roads includes the Cities of Chesapeake, Franklin, Hampton, Newport News, Norfolk, Poquoson, Portsmouth, Suffolk and Virginia Beach, and the Counties of Isle of Wight and Southampton.
- Northern Virginia includes the Cities of Alexandria, Fairfax, Falls Church, Manassas, and Manassas Park; and the Counties of Arlington, Fairfax, Loudoun, and Prince William.
- Historic Triangle includes the City of Williamsburg, and the Counties of James City and York.
Sales of aircraft, watercraft, and motor vehicles are taxed at different rates than those listed above. For more information about the motor vehicle sales tax, visit the Department of Motor Vehicles.
Do you need to register to collect sales tax?
If you sell, lease, distribute, or rent tangible personal property to customers in Virginia, or otherwise meet the definition of a “dealer,” and have “sufficient activity” in Virginia, you have nexus as defined in Va. Code § 58.1-612, and must register to collect and pay sales tax in Virginia.
- In-state dealers: generally individuals and businesses making sales with, or at, one or more physical locations in Virginia (like an office, warehouse, fulfillment center, or similar place of business) must register to collect sales tax as an in-state dealer.
- Out-of-state dealers: generally individuals and businesses located outside of Virginia, but with sufficient physical or economic presence to establish nexus in Virginia must register to collect sales tax as an out-of-state dealer. Starting July 1, 2019, this includes remote sellers or online retailers that make more than $100,000 in annual Virginia gross sales or 200 or more transactions to Virginia customers.
- Marketplace facilitators and remote sellers that have economic nexus in Virginia (i.e. more than $100,000 in annual Virginia gross sales or 200 or more transactions to Virginia customers) must register to collect and pay sales tax starting July 1, 2019. Generally, businesses without a physical location in Virginia that meet the economic nexus threshold should register as an out-of-state dealer, and businesses with a physical location should register as an in-state dealer. Marketplace facilitators must indicate that they are a marketplace facilitator when registering.
For additional information on registering, filing and paying Virginia Retail Sales and Use Tax, please visit the Virginia Tax website.