What is the Ohio State Sales Tax?
Ohio, like many other states in the United States, imposes a sales tax on the sale of goods and services within its borders. The Ohio state sales tax is a type of consumption tax that is levied on the purchase of tangible personal property, such as clothing, furniture, and electronics, as well as certain services, like haircuts and hotel stays.
What is the Ohio State Sales Tax Rate?
The Ohio state sales tax rate is 7.5%, which is comprised of two components: the state sales tax rate of 5.75% and the local sales tax rate of 1.75%. The local sales tax rate varies depending on the municipality or county where the sale is made. Some cities and counties in Ohio have a higher local sales tax rate than others.
What is Subject to Ohio State Sales Tax?
The following goods and services are subject to the Ohio state sales tax:
- Tangible personal property, such as:
- Clothing and accessories
- Furniture and appliances
- Electronics and computer software
- Jewelry and watches
- Sports equipment and recreational vehicles
- Services, such as:
- Haircuts and beauty services
- Hotel stays and accommodations
- Restaurant meals and food delivery
- Entertainment services, such as concerts and movies
- Professional services, such as lawyers and accountants
What is Exempt from Ohio State Sales Tax?
The following goods and services are exempt from the Ohio state sales tax:
- Food and food ingredients, such as:
- Groceries and fresh produce
- Meat, dairy products, and bakery items
- Restaurant meals and food delivery (except for prepared food and beverages)
- Medications and medical devices, such as:
- Prescription medications
- Medical devices and equipment
- Medical supplies and oxygen equipment
- Other exempt items, such as:
- Books and educational materials
- Newspapers and magazines
- Fuel and energy sources
- Agricultural equipment and supplies
How is Ohio State Sales Tax Calculated?
The Ohio state sales tax is calculated by multiplying the purchase price of the goods or services by the applicable sales tax rate. For example, if you purchase a pair of shoes for $100 and the sales tax rate is 7.5%, the sales tax would be:
$100 (purchase price) x 0.075 (sales tax rate) = $7.50 (sales tax)
The total amount you would pay is:
$100 (purchase price) + $7.50 (sales tax) = $107.50
How to File Ohio State Sales Tax Returns
Businesses that sell goods or services in Ohio are required to file a sales tax return with the Ohio Department of Taxation. The return must be filed on a monthly, quarterly, or annual basis, depending on the business’s sales volume. The return must include the following information:
- Gross sales: The total amount of sales made during the reporting period
- Sales tax collected: The total amount of sales tax collected during the reporting period
- Sales tax paid: The total amount of sales tax paid to the state during the reporting period
Consequences of Not Filing Ohio State Sales Tax Returns
Failure to file Ohio state sales tax returns can result in penalties and fines. The Ohio Department of Taxation may also suspend or revoke a business’s sales tax permit if it fails to file returns or pay sales tax owed.
Conclusion
The Ohio state sales tax is an important source of revenue for the state and its local governments. Understanding what is subject to the sales tax, what is exempt, and how to file returns is crucial for businesses that sell goods or services in Ohio. By following the rules and regulations, businesses can ensure compliance with the Ohio state sales tax and avoid penalties and fines.
Additional Resources
- Ohio Department of Taxation: www.tax.ohio.gov
- Ohio Revised Code: www.ohio.gov/ocelot/ORS/Chapter%20135/135.01.pdf
Table: Ohio State Sales Tax Rates
| Municipality/County | Local Sales Tax Rate |
|---|---|
| Cuyahoga County | 1.75% |
| Franklin County | 1.75% |
| Hamilton County | 1.75% |
| Lucas County | 1.75% |
| Summit County | 1.75% |
| Other counties | 1.00% to 1.75% |
Note: The local sales tax rate may vary depending on the municipality or county where the sale is made.