Vermont Sales Tax Guide 2025: A Step-by-Step Guide for Businesses

Vermont Sales Tax: 2025 Overview

Sales tax in Vermont is a 6% statewide rate in 2025, with additional local taxes possible. As of 2025, Vermont does not participate in the Streamlined Sales Tax initiative (SSUTA). Historically, Vermont has consistently maintained one of the most predictable sales tax structures in the United States.

Vermont Sales Tax Due Date

In Vermont, sales tax due dates depend on your assigned filing frequency, which is based on the amount of sales tax your business collects. Here’s a breakdown:

Filing Frequency	Due Date
Monthly	Due on the 25th of the month following the taxable month.
Quarterly	Due on the 25th of the month following the taxable quarter.
Annually	Due on January 25th of the following year.

Key Points

• If the due date falls on a weekend or holiday, the payment is typically due the next business day.
• Late filings or payments may incur penalties and interest, and obtaining a refund may be challenging, so timely submission is critical.
• All sales tax returns must be filed electronically through Vermont’s myVTax portal.

Vermont Sales Tax Rate in 2025

In Vermont, certain municipalities impose a 1% Local Option Sales Tax in addition to the state's 6% sales tax, resulting in a total of 7% in these areas.

Tax Type	Rate	Description
State Sales Tax	6.0%	Applies to most retail sales of tangible personal property, taxable services, and digital goods.
Local Option Tax	1.0% (additional)	Imposed by certain municipalities on top of the state sales tax.

Below is a table of municipalities that have adopted this tax, along with their effective dates:

Municipality	Effective Date
Barre City	October 2022
Berlin	January 2025
Brandon	October 2016
Brattleboro	July 2019
Burlington	July 2006
City of Essex Junction	October 2022
City of Rutland	July 2023
Colchester	October 2015
Dover	July 2007
Manchester	April 1999
Middlebury	October 2008
Montgomery	October 2022
Rutland Town	April 2009
Shelburne	July 2023
St. Albans City	October 2020
St. Albans Town	July 2014
South Burlington	October 2007
Stowe	July 2023
Stratton	July 2004
Waterbury	July 2024
Williston	July 2003
Wilmington	July 2012
Winhall	July 2010
Winooski	July 2019
Woodstock	July 2024

Notes

• Not all municipalities in Vermont impose the Local Option Tax; verify if it applies to your location.
• Note that the City of Burlington and the City of Rutland administer and collect their own local meals, entertainment, lodging, or alcoholic beverage taxes.
• Certain exemptions exist, such as for groceries, prescription medications, and some manufacturing equipment.
• For the most current information, you can use the Vermont Department of Taxes' Local Option Tax Finder to determine if a specific address or town has a Local Option Tax.

Vermont Sales Tax Calculator Example

An online retailer based in New York establishes economic nexus in Vermont by exceeding $100,000 in annual sales, requiring them to collect and remit sales tax for purchases made by Vermont residents. The retailer must collect and remit Vermont sales tax for all taxable sales made to Vermont customers.

Detail	Description
Business	Online retailer based in New York with economic nexus in Vermont.
Customer Purchase	$1,200 total, including $800 taxable items and $400 exempt items (e.g., groceries or medications).
Customer Location	Burlington, VT (subject to a 1% local option tax in addition to the 6% state sales tax).
State Sales Tax (6%)	$800 (taxable amount) × 6% = $48.00
Local Option Tax (1%)	$800 × 1% = $8.00
Total Sales Tax Due	$48.00 (state tax) + $8.00 (local option tax) = $56.00

Key Considerations for Businesses

• Location Accuracy: Verify the customer’s location to apply the correct local option tax rate.
• Exemption Management: Identify and apply exemptions, such as for groceries or prescription medications, and ensure proper use of a resale certificate for qualified purchases.
• Tax Reporting: Track taxable and exempt sales for accurate reporting and timely remittance.

Is there a Vermont SaaS sales tax?

Yes, Vermont imposes sales tax on certain Software as a Service (SaaS) products. In Vermont, SaaS is generally classified as "tangible personal property" when delivered electronically, and sales tax applies.

Category	Details	Examples
Taxable SaaS	Software delivered electronically that provides access to functionality or applications hosted by the seller.	Cloud-based accounting software subscription.
Non-Taxable SaaS	Services primarily considered personal or professional, without substantial reliance on software.	Custom software development or consulting services.

Additional Considerations

• SaaS providers may need to collect and remit sales tax if they have nexus in Vermont.
• Businesses purchasing SaaS should review applicable exemptions, like those for manufacturing or educational purposes, which might apply.

Is there sales tax on clothing in Vermont?

Vermont generally does not impose sales tax on clothing, making most clothing purchases tax-exempt. However, there are a few important exceptions and details to keep in mind:

Category	Details	Examples
Exempt Clothing	Most clothing and footwear items are exempt from sales tax.	Shirts, pants, shoes, winter coats, etc.
Taxable Exceptions	Certain items related to clothing are taxable, even though general clothing is exempt.	Jewelry, handbags, wallets, ski boots, helmets.
Protective Equipment	Gear designed for safety purposes is taxable.	Hard hats, goggles, protective gloves.
Thresholds and Business Purchases	Businesses purchasing clothing for resale or uniforms may have specific tax considerations.	Uniforms for employees or resale inventory.

FAQs

What is the sales tax rate in Vermont?

The sales tax rate in Vermont is 6%, with some municipalities adding a local option tax of up to 1%. This applies to most retail sales, leases, and taxable services in the state.

How do you calculate Vermont sales tax?

To calculate Vermont sales tax, multiply the item's sale price by the 6% statewide tax rate. If applicable, add up to 1% for local option taxes based on the municipality where the sale occurs.

Sales Tax Nexus in Vermont

Sales tax nexus in Vermont establishes a business's obligation to collect sales tax, triggered by physical presence, economic activity, or relationships with in-state entities.

Type of Nexus	Description	Threshold/Criteria
Physical Nexus	Created by having a physical presence in Vermont, such as a location, employees, or inventory.	Office, warehouse, or storefront in Vermont. Employees or agents working in the state.
Economic Nexus	Triggered by making substantial sales into Vermont, even without a physical presence.	More than $100,000 in gross sales or 200 separate transactions in the current or previous year.
Affiliate Nexus	Created through relationships with in-state businesses that help facilitate sales.	A Vermont-based affiliate promotes or sells products for the out-of-state retailer.
Marketplace Nexus	Applies to sales made through marketplace facilitators operating in Vermont.	Facilitators must collect and remit sales tax on behalf of sellers.
Click-Through Nexus	Established through online referrals by Vermont-based individuals or businesses.	Sales exceed $10,000 annually from Vermont-based referrals.
Inventory Nexus	Triggered by storing inventory in Vermont, even if through a third party (e.g., warehouses).	Any physical inventory located in Vermont.
Employee or Agent Nexus	Having employees, independent contractors, or agents perform services in Vermont.	Sales or service activities conducted by representatives in Vermont.

Notes

• Vermont uses both physical presence and economic presence to determine nexus.
• Businesses with nexus in Vermont must register for a sales tax permit and collect sales tax on taxable sales.
• Marketplace facilitators are responsible for sales tax collection for third-party sales made through their platforms.

FAQs

What is the sales tax nexus in Vermont?

Sales tax nexus in Vermont is established through physical presence, such as offices or warehouses, or economic thresholds, like exceeding $100,000 in sales or 200 transactions annually. Businesses meeting these criteria must collect Vermont sales tax.

Vermont Sales Tax Exemptions in 2025

In 2025, Vermont maintains its 6% state sales tax, with exemptions for groceries, clothing, prescription, and non-prescription drugs.

What is a Vermont state tax-exempt certificate?

A Vermont state tax-exempt certificate, also known as Form S-3, is a document that allows eligible buyers to make tax-exempt purchases in Vermont. It certifies that the buyer qualifies for an exemption under Vermont sales tax law.

• Purpose: Used for transactions exempt from sales tax, such as purchases by government agencies, non-profit organizations, or resale purposes.
• Usage: The buyer provides the certificate to the seller at the time of purchase to avoid paying sales tax.
• Retention: Sellers must keep a copy of the certificate on file to validate tax-exempt transactions in case of an audit.

Valid Reasons for Exemption

Exemption Category	Description	Examples
Resale	Items purchased for resale.	Products bought by retailers for inventory.
Manufacturing	Qualifying equipment and materials used in production.	Machinery, raw materials for production.
Nonprofit Organizations	Tax-exempt entities making qualified purchases.	Purchases by charitable organizations.
Government Agencies	Federal, state, or local government entities.	Office supplies bought by government offices.

What is exempt from sales tax in Vermont?

Nearly 85% of business leaders prioritize cost savings when managing business expenses, making Vermont's sales tax exemptions and use tax considerations critical.

This table outlines key exemptions to help businesses optimize their tax strategies:

Category	Exempt Items
Essential Goods	Most groceries (excluding prepared foods, candy, and soft drinks)
	Prescription medications
	Durable medical equipment (e.g., wheelchairs, medically necessary devices)
	Clothing and footwear (under $110 per item)
Utilities	Residential heating fuel (oil, propane, firewood)
	Electricity and natural gas for residential use
	Residential water charges
Agriculture and Manufacturing	Farming supplies (e.g., seeds, fertilizers, farm equipment)
	Manufacturing machinery used directly in production
Nonprofit and Government	Purchases by qualifying charitable organizations
	Government purchases (federal, state, and local)
Educational Materials	Textbooks for educational use
Occasional Sales	Casual sales by individuals not engaged in a regular business (e.g., yard sales)

Vermont Sales Tax Permits, Registration, and Filing in 2025

This section simplifies obtaining permits, filing returns, and meeting payment deadlines effectively for businesses with buyers in Vermont.

How do I get a Vermont sales tax permit?

To obtain a sales tax permit in Vermont, follow these steps:

• Register Online: Visit Vermont’s myVTax portal (myVTax) to start your registration.
• Provide Business Details: Submit information such as your business name, address, type of business entity, and federal EIN or Social Security number.
• Pay the Registration Fee: Vermont does not charge a fee for obtaining a sales tax permit.
• Receive Your Permit: Once approved, you'll receive a Vermont Business Tax Account number, which allows you to collect and remit sales tax.

How do I submit a Vermont sales tax registration?

To register for Vermont sales tax, follow these steps. Vermont also offers customer support for registration through their website or by phone at (802) 828-2551.

Determine if You Need to Register

• Businesses with nexus (physical or economic presence) in Vermont must register.
• Nexus may result from:
  • A physical location or employees in Vermont.
  • Remote sales exceeding $100,000 in gross revenue or 200 transactions annually into Vermont.

Gather Required Information

• Business name, address, and contact details.
• Federal Employer Identification Number (FEIN) or Social Security Number (SSN) for sole proprietors.
• Legal structure of the business (e.g., sole proprietorship, LLC, corporation).
• Estimated monthly taxable sales in Vermont.

Register Online

• Visit the Vermont Department of Taxes website.
• Navigate to the “Business Taxes” section and select “Register for a Business Tax Account”.
• Complete the online registration form through the myVTax portal.

Submit Registration

• Ensure all information is accurate before submission.
• You’ll receive a confirmation email or letter with your Vermont Business Tax Account number once approved.

Begin Collecting and Remitting Sales Tax

• After registration, you can start collecting sales tax.
• Use the myVTax portal to file returns, remit collected taxes, and manage use tax obligations.

Vermont Sales Tax Filing

This section breaks down Vermont’s sales tax requirements, including filing rules, taxable items, and permits.

What are the main Vermont filing requirements?

Vermont sales tax filing requirements depend on the size and frequency of taxable sales:

• Filing Frequency: Businesses must file monthly, quarterly, or annually based on their total sales tax liability.
• Due Date: Returns are due on the 25th of the month following the reporting period.
• Filing Method: Returns must be filed electronically through Vermont’s myVTax portal.
• Additional Requirements: Businesses must report all taxable and exempt sales and remit payment for collected taxes by the due date to avoid penalties and interest.

Filing Frequency	Criteria
Monthly	For businesses collecting more than $500 in tax per month.
Quarterly	For businesses collecting $500 or less in tax per month but more than $50 per quarter.
Annually	For businesses collecting $50 or less in tax per quarter.

What does Vermont sales tax apply to?

Vermont sales tax applies to the following categories, along with specific Vermont food tax considerations. Certain exemptions apply, such as for groceries, prescription medications, and manufacturing equipment.

Category	Description	Examples
Tangible Personal Property	Most goods, unless exempt.	Furniture, electronics, clothing (if taxable).
Taxable Services	Certain services are subject to sales tax.	Amusements, telecommunications, some repairs.
Digital Goods	Digital products transferred electronically.	Prewritten software, e-books, digital media.
Leases and Rentals	Rentals of equipment and property.	Equipment rentals, car rentals.
Prepared Foods	Meals and drinks sold by food service businesses.	Restaurant meals, takeout, catering.

How to file sales tax in Vermont

To file sales tax in Vermont, follow these steps:

• Log in to myVTax: Access Vermont’s online tax portal (myVTax) using your credentials.
• Complete the Sales Tax Return: Enter total taxable sales, exempt sales, and any applicable local option taxes.
• Calculate Tax Due: myVTax automatically calculates the sales tax owed based on your entries.
• Submit Payment: Pay electronically via the portal or by other approved methods.
• Meet Deadlines: Returns are due by the 25th of the month following the reporting period (monthly, quarterly, or annually, depending on your assigned frequency).
• Maintain Records: Keep copies of filed returns and payment confirmations for audit purposes.

FAQs

What day is Vermont sales tax due?

Vermont sales tax is due on the 25th day of the month following the taxable sales period. For example, sales made in January must have taxes filed and paid by February 25th.

Does Vermont have a sales tax holiday?

No, Vermont doesn't currently have a sales tax holiday. Unlike some states like Florida, Texas, and Massachusetts, Vermont does not offer a designated period where certain items can be purchased tax-free.

Automate Your Vermont Sales Tax with Kintsugi

Managing Vermont sales tax compliance can be complex, from verifying local tax rates to tracking exemptions and meeting filing deadlines. Kintsugi simplifies this process with powerful automation tools designed for modern businesses.

Feature	Description
Accurate Tax Rate Calculations	Automatically apply the correct state and local sales tax rates based on your customer’s location.
Exemption Management	Seamlessly identify and apply exemptions for groceries, prescription medications, and other qualifying items.
Effortless Filing	Streamline your tax reporting and filing process with integrations that calculate, track, and submit sales tax payments.
ERP and eCommerce Integration	Connect with platforms like Shopify, QuickBooks, Amazon, and more for seamless tax data management.

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