Vermont – VT Sales Tax Calculator: User Guide

Vermont is a northeastern US state known for its natural landscape in the United States' New England region. The state shares its borders with New Hampshire to the east, New York to the west, Massachusetts to the south, and the Canadian province of Quebec to the north.

It is the second-least-populated and the sixth-smallest by area among the 50 states. Montpelier is the Capital City of the state, while Burlington is the largest city and Greater Burlington is the largest metro.

Also known as the Green Mountain State, Vermont is home to charming towns, Ben & Jerry's ice cream, farm-to-table dining, and Phish. Moreover, it is also the nation's largest maple syrup producer.

It doesn't end here!

Vermont is also filled with awe-inspiring scenery, growing opportunities, a great lifestyle, healthiest people, a flourishing economy, and a favorable business environment attracting numerous businesses and entrepreneurs to start, expand or relocate their business in the Green Mountain State.

So, if you are one of them, then you must educate yourself with Vermont Sales Tax.

Our experts have invested their time and years of experience to bring you a precise guide and a handy VT Sales Tax Calculator to educate you with all the basics of Vermont Sales Tax.

So let's learn!

Vermont Sales Tax Facts:

• 6% is the base sales tax charged at the state level in Vermont. On top of it, a few cities also collect their own 1% as local option sales tax, raising the combined sales tax rate to 7%.
• City of St. Albans, The City of Burlington, and the City of Rutland administer and collect their own sales tax on local lodging, meals, entertainment, and alcoholic beverages.
• Brandon, Vermont is among cities that charge the highest possible combined sales tax rate of 7%.
• Brattleboro, Vermont, is among cities that charge the lowest possible combined sales tax rate of 6%.
• 4% of states in the US have a lower sales tax than Vermont.
• Food which intended for off-site consumption is exempted from Vermont Sales Tax. Moreover, medical equipment like wheelchairs or oxygen equipment, newspapers, clothing, prescription, and some over-the-counter drugs are also exempted.
• 6% of Vermont State Sales tax (but no local sales tax) is charged on Motor vehicles by the Vermont Department of Motor Vehicles. Moreover, 9% of sales tax is charged on short-term car rentals.
• The hotels, motels, and restaurant meals are charged with a higher sales tax rate of 9%, plus an additional 1% local option as the "Meals and Rooms Tax."
• 10% (plus a 1% local option tax in some cities) of sales tax is charged on Alcohol. Besides, the excise tax is also applied.
• Vermont Use Tax is imposed at the same rate as the sales tax on the buyers who purchased from out-of-state sellers or states that don't levy sales tax and use it in Vermont without paying VT sales tax.
• Tangible personal property bought by businesses and individuals for resale, improvement, or raw materials can use Vermont Sales Tax Exemption Form to exempt this TTP from sales tax.

How to calculate Sales Tax in Vermont?

Businesses and Sellers involved in retail sales of tangible personal property unless exempted by law and taxable services, and have Nexus in Vermont are required to register for Vermont Sales tax and obtain a sales tax license. This license must be acquired separately for each business place in Vermont in case of multiple business locations.

They must collect, manage, and remit it to the Vermont Department of Taxes while staying in compliance with state laws and avoid penalties and interest.

The sales tax determined on four factors:

1. Nexus: It is a connection of business with a state. The business is only liable to pay taxes to the states with Nexus.
2. Out of State Seller's Eligibility: Out of State Seller is only required to register, collect, and remit the sales tax to the authorities in the state if it falls under the criteria provided by the state.
3. Location and Products or Services: The sales tax rate varies from product to product and location to location, so you must check the sales tax rate applicable to your product according to the product category, county, and city in Vermont.
4. Exemptions: Almost all goods are eligible for sales tax regulation—however, groceries, medical equipment like wheelchairs or oxygen equipment, newspapers, clothing, prescription, and some over-the-counter drugs are exempt from sales tax.

You should also check with the Vermont Department of Taxes regularly about which goods and services sold in Vermont are subject to sales tax.

To calculate Sales Tax in Vermont, follow the steps below:

Step 1 – Determine your Nexus:

As a business owner, you are only required to collect sales tax if you are eligible for collecting sales tax and have Sales Tax Nexus in the Vermont State. And to determine your Nexus in Vermont, you must have any of the following:

• Making more than $100,000 in sales annually in the Vermont state during any preceding twelve-month period;
• More than 200 transactions in Vermont during any preceding twelve-month period

Step 2 – Determine the Sales Tax Rate:

Once you have determined that your Nexus is with Vermont, next is to deduce the Sales Tax rate (State + County + City) applicable to your product, for which you can refer to the tables below:

Step 4 – Calculate Sales Tax:

After determining the sales tax rate according to the location and type of purchases, it is easy to calculate the sales tax amount charged on the product and gross price (amount after-tax) of a product.

Example # 1:

For instance, you sell a CCTV Camera on your store in Rutland, Vermont, having a net cost of $100. The amount of Sales Tax that you have to pay on the CCTV Camera would be:

Manual Method:

Net Price (amount before Tax) of a CCTV Camera: $100

Total Sales Tax rate: 1.00% (Rutland) + 0.00% (Rutland County) + 6.00% (Vermont State) = 7.00%

Total Sales Tax amount = $100 x 7.00% = $7

Gross Price (Amount after Tax) = 100 + 7 = $107

So, the Sales Tax amount charged on the CCTV Camera would be $7, raising the gross cost to $107.

Using our Sales Tax Calculator:

All of the steps mentioned above can be skipped to get an instant result using our Sales Tax Calculator. All you need is:

1. Input the $7 as the Net Price of a CCTV Camera as Amount Before Tax
2. Input or select 00% of the combined Sales Tax rate on the Tax Rate menu.

Our calculator will automatically calculate the result, and represents it in 3 different forms, as shown in the image below:

Reverse Sales Tax Calculation

In the example above, we have explained to you to calculate the Sales Tax amount payable in a product and the Gross Price of the Product.

But there are also instances when you are required to deduce how much Sales tax you have actually paid on a product in Vermont.

This is where the Reverse Sales Tax Calculation Kicks in. And luckily, our Vermont Sales Tax Calculator can perform this calculation like a Pro.

Example:

The gross cost (amount after tax) of a Wireless Charger is $65, which you sell on your store in Vergennes, Vermont. Now, if you want to deduce the amount of sales tax you have actually paid on it and the net cost (amount before tax) of a Wireless Charger, you can follow the steps below:

Gross Price (Amount after Tax) of Wireless Charger: $65

Total Sales Tax rate: 0.00% (Vergennes) + 0.00% (Addison County) + 6.00% (Vermont State) = 6.00%

Manual Method:

Gross Price with sales tax = [Net Price × (tax rate in decimal form + 1)]

65 = [Net Price x ((6.00/100) + 1)]

65 = Net Price x 1.06

$61.3 = Net Price

So, the original Price (net price) of the Wireless Charger would be $61.3.

Using our Sales Tax Calculator:

You can also use our Sales Tax Calculator for Reverse Sales Tax calculation to skip the aforementioned manual method. All you need is:

1. Input the $65 Gross Price of Wireless Charger as Amount after Tax
2. Input or select 6.00% of combined Sales Tax Rate on the Tax Rate

Our calculator will automatically calculate the result and represents it in 3 different forms.

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