Sales & Use
Colorado levies a 2.9% sales tax on goods purchased by a business that are not intended for resale. Services and food items are excluded from sales tax, with the exception of soda and candy. Use taxes substitute for sales taxes in cases where an item is purchased for consumption in Colorado from a source outside Colorado, or other circumstances where a sales tax was not paid.
Like many other states, Colorado allows its cities and towns to assess a local sales tax. The maximum municipal sales tax rate currently charged by any of the towns and cities in Colorado is 5%.
Various special districts impose additional sales taxes in Metro Denver, including the Regional Transportation District (1%) and the Cultural Facilities District (0.1%).
Combined state, local, and special district sales tax rates in Metro Denver and Northern Colorado range from 2.9% to 9.25%.
Colorado's gasoline tax is $0.22 per gallon, which is near the national average, while its cigarette tax is $0.84 per pack, and subject to 2.9% sales tax.
Colorado refunds state sales and use taxes paid on the sale, storage, use, or consumption of tangible personal property to be used in Colorado directly and predominantly in the research and development of biotechnology.
State Sales Tax Exemptions
(Relevant to Business, exemptions include but are not limited to)
- Food, including food sold through vending machines
- Guidelines for Determining Sales Tax Rates for Taxable Food Items
- Vending Machines
- Residential Energy Usage - all gas, electricity, coal, wood and fuel oil
- Medical Equipment & Medicine
- Coins and Precious Metal Bullion
- Farm Equipment
- Seeds, Plants and Trees
- Machinery and Machine Tools
- Sales of Low-Emitting Vehicles
- School Related Sales
- Renewable Energy Components
- Beetle Wood Products
- Space Flight
- Air Craft and Air Craft Parts
- Some Construction Projects