Vermont exempts both groceries and clothing from sales tax — one of the most consumer-friendly combinations in New England. The 6% base rate is moderate with minimal local add-ons (Burlington adds 1% for a 7% total). Vermont has no sales tax holidays but its broad permanent exemptions serve a similar purpose for everyday necessities.
Vermont sales tax overview
| Component | 2026 Rate |
|---|---|
| State sales tax | 6.00% |
| Avg local add-on | 0.360% |
| Avg combined | 6.36% |
| Maximum combined | 7.00% |
Note: Vermont exempts both clothing and groceries.
Vermont sales tax by city
Combined state + local sales tax rates for major cities in Vermont:
| City | Combined Rate |
|---|---|
| Burlington | 7.00% |
| South Burlington | 7.00% |
What's exempt in Vermont
Groceries
Exempt from Vermont state sales tax. Local jurisdictions may still tax.
Clothing & footwear
Exempt from Vermont sales tax.
Prescription drugs
Exempt from sales tax (typical across most states).
How Vermont sales tax is calculated
Sales tax in Vermont is calculated by multiplying the pre-tax purchase price by the applicable combined rate. The formula is simple:
Sales Tax = Purchase Price × 6.36% (avg combined)
Total = Purchase Price + Sales Tax
The exact rate depends on where the purchase occurs — the state base rate (6.00%) plus any local city or county add-ons. Vermont allows local jurisdictions to add their own taxes, so the rate varies by location.
Quick calculation examples at average rate 6.36%:
$100 item
$6.36 tax
$106.36 total
$250 item
$15.90 tax
$265.90 total
$500 item
$31.80 tax
$531.80 total
$1,000 item
$63.60 tax
$1063.60 total
Additional tax-free items in Vermont
Beyond the standard exemptions, Vermont also provides sales tax relief on these categories:
Exemptions may have conditions. Always verify with the Vermont Department of Revenue for complete rules.
Vermont sales tax in context: rates, history, and neighbors
Vermont's 6% state sales tax (since 2003) plus minimal local taxes (1% in Burlington, South Burlington, and a few others) gives an average combined rate of 6.36% — among the lower combined rates in the Northeast. Burlington 7%, Montpelier 6%, Rutland 6%. VT exempts both groceries AND all clothing — among the most consumer-friendly exemption combinations. VT's specialized tax categories include 9% on restaurant meals and lodging (6% sales + 3% meals and rooms), and 10% on alcoholic beverages. VT is a Streamlined Sales Tax (SST) Agreement member. Compared to neighbors: New Hampshire (0%), New York (~8.52% combined NYC), Massachusetts (6.25%) — VT's 6.36% combined is moderate, but the broad exemptions make everyday shopping relatively affordable.
Online shopping & Vermont sales tax
Vermont requires economic nexus — remote sellers with $100,000+ or 200+ Vermont transactions must collect Vermont's 6% sales tax. Vermont is a member of the Streamlined Sales Tax (SST) Agreement. Vermont also taxes most digital goods including downloaded content and streaming subscriptions at the standard rate.
Use Tax reminder: If you purchase taxable goods online from a seller who does NOT collect Vermont sales tax, you technically owe Use Tax — the same rate as sales tax, reportable on your Vermont state tax return. Use Tax enforcement on consumers is rare but the obligation exists for significant purchases.
How much Vermont sales tax on common purchases?
Using Vermont's average combined rate of 6.36%:
| Purchase | Price | Sales Tax | Total |
|---|---|---|---|
| Grocery cart | $150 | Exempt | $150.00 |
| Clothing / shoes | $120 | Exempt | $120.00 |
| Prescription drug | $80 | Exempt | $80.00 |
| Smartphone | $999 | $63.54 | $1062.54 |
| Laptop / tablet | $1,299 | $82.62 | $1381.62 |
| New car ($35,000) | $35,000 | $2226.00 | $37226.00 |
| Home appliance | $1,500 | $95.40 | $1595.40 |
| Restaurant meal | $60 | $3.82 | $63.82 |
Based on Vermont's average combined rate of 6.36%. Exact tax depends on city/county. Use our calculator above for specific locations and amounts.
Collecting sales tax in Vermont: business guide
If you sell goods or taxable services to Vermont customers, here's what you need to know:
- Registration: Register for a Vermont sales tax permit/license through the Vermont Department of Revenue before making your first taxable sale. Most states process registrations online within a few days.
- Economic nexus (online sellers): If you have $100,000+ in Vermont annual sales or 200+ transactions, you must collect Vermont sales tax even without a physical presence in the state — per South Dakota v. Wayfair (2018). You must collect both state (6.00%) and applicable local rates.
- Destination vs origin sourcing: Vermont uses destination-based sourcing for most sales — the tax rate where the buyer receives the goods applies. Always use the customer's delivery address to determine the rate.
- Filing frequency: Frequency depends on your Vermont sales volume — monthly for high-volume sellers, quarterly or annually for low-volume sellers. Check with the Vermont Department of Revenue for your specific filing schedule.
- Marketplace sales: If you sell through Amazon, Etsy, eBay, or similar platforms, the marketplace is required to collect and remit Vermont sales tax on your behalf — you don't need to collect it separately on marketplace transactions.
- Resale certificates: Businesses purchasing goods for resale can provide a Vermont resale certificate to suppliers to avoid paying sales tax on wholesale purchases. Keep copies of all resale certificates for audits.
Streamlined Sales Tax (SST): Vermont is a full member of the Streamlined Sales Tax (SST) Agreement, which simplifies multi-state sales tax registration and compliance through a single registration portal (streamlinedsalestax.org).
Vermont-specific business compliance details
Vermont businesses register with the VT Department of Taxes at tax.vermont.gov for a Sales and Use Tax Account. Filing frequency: monthly for most businesses, quarterly for smaller, annually for very small. Out-of-state sellers with $100,000+ in VT sales (or 200+ transactions) must collect VT tax (economic nexus, since 2018). VT is a Streamlined Sales Tax (SST) Agreement member. Marketplace facilitators collect VT tax. VT uses destination-based sourcing. Restaurants, hotels, and short-term rentals must register separately for the Meals and Rooms Tax (9%) — additional compliance for hospitality businesses. Penalties: 5% per month (capped at 25%) plus interest. VT's tourism-heavy economy means M&R tax is a major state revenue source.
Vermont sales tax frequently asked questions
What sales tax exemptions make Vermont one of the most consumer-friendly?
Vermont exempts both groceries and all clothing from sales tax — a combination shared by very few states. A family of four shopping for groceries ($200/week) and clothing ($100/month) in Vermont avoids approximately $300+ per year in sales tax compared to shopping in a state that taxes both at 6%. Combined with the already-small 6% base rate and minimal local taxes, Vermont is consistently ranked among the more affordable states for everyday consumer purchases.
What is the sales tax rate in Burlington, Vermont?
Burlington has a combined rate of 7% (6% Vermont state + 1% Burlington city). Most of Vermont outside Burlington has just the 6% state rate with minimal or no local additions. Vermont's population-weighted average local rate is about 0.36%, making it one of the states with the least local tax variation.
Does Vermont charge sales tax on restaurant meals?
Yes — Vermont charges 9% on restaurant meals and prepared food (6% base sales tax + 3% meals and rooms tax). Hotel accommodations are also taxed at 9%. This is significantly higher than the standard 6% retail rate, reflecting Vermont's reliance on tourism revenue from ski resorts, fall foliage visitors, and summer tourism. Alcoholic beverages face an additional 10% meals and rooms tax.