Navigating sales tax compliance can be confusing, especially when dealing with emerging and nuanced issues like tariff fees. As more businesses import goods affected by tariffs, a key question arises: Should you charge sales tax on tariff fees passed to customers? The answer varies significantly by state, and clear guidance can be sparse.
In this blog post, we'll clarify what tariff fees are, distinguish them from tariffs, and detail the current taxability of these fees state-by-state. We'll continuously update this article as we receive new information from state authorities.
This guide specifically addresses whether tariff fees passed to customers should be subject to state sales tax.
Many states haven't provided explicit guidance on taxing tariff fees. As we gather information, we'll update each state's status.
Each state's summary answers three questions:
To be determined.
Does Arizona require sales tax on a tariff fee?
Yes, Arizona generally does require sales tax on tariff fees.
Why?
According to guidance from Arizona's Tax Policy division dated 5/7/2025, all sales of tangible personal property are subject to Arizona’s Transaction Privilege Tax (TPT), unless specifically exempted by statute. Arizona defines "gross income" or "gross receipts" under A.R.S. § 42-5001 as the total sale amount without deductions for costs such as tariffs, materials, labor, or any other expenses. Since tariff fees are included in the gross income, they are generally taxable.
Where can I learn more?
You can learn more about Arizona's gross income definitions and requirements by reviewing A.R.S. § 42-5001 or visiting the Arizona Department of Revenue website.
Does Arkansas require sales tax on a tariff fee?
Yes, Arkansas generally requires sales tax on tariff fees.
Why does Arkansas require sales tax on a tariff fee?
Arkansas is a full member of the Streamlined Sales Tax (SST) initiative. According to recent SST guidance, if an importer passes a tariff fee to the customer as part of the sales price, that fee is treated just like the product being sold.
In other words, if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on their website.
Does California require sales tax on a tariff fee?
Yes, California generally does require sales tax on tariff fees.
Why?
California states clearly that if the seller is also the importer and passes the tariff cost to customers as a separate fee, it becomes part of the overall selling price and is thus included in the taxable base.
Where can I learn more?
The California Department of Tax and Fee Administration (CDTFA) Annotation 325.0232(b) addresses the taxability of tariffs explicitly.
Does Colorado require sales tax on a tariff fee?
Yes, Colorado generally requires sales tax on tariff fees.
Why does Colorado require sales tax on a tariff fee?
According to the Colorado Office of Tax Policy, the state calculates sales tax based on the full purchase price. That includes everything the buyer pays or agrees to pay for the item—per C.R.S. § 39-26-102(7).
So, if a buyer is purchasing tangible personal property from an importer who adds a tariff fee to the price, that fee is not considered a direct federal tax. Instead, it’s part of the total purchase price. Since Colorado taxes the full amount paid to the seller—including any markup to cover tariff costs—the tariff fee is generally taxable.
Where can I go to learn more?
You can refer to the Colorado Revised Statutes, Title 39 (2024) for more information on tax rules and definitions.
To be determined.
Delaware does not have a state sales tax and therefore does not generally require sales tax on a tariff fee.
To be determined.
Does Georgia require sales tax on a tariff fee?
Georgia likely requires sales tax on tariff fees.
Why?
Georgia generally imposes sales tax on the retail price of tangible personal property and certain services. Additionally, charges necessary to complete a sale, like tariff fees, may also be taxable, though this is not yet officially confirmed.
Where can I learn more?
Visit the Georgia Department of Revenue website for more details on taxable items.
Does Hawaii require sales tax on a tariff fee?
Yes, Hawaii generally does require sales tax on tariff fees.
Why?
Hawaii calculates sales or use tax based on the “landed value” of goods, including purchase price, shipping fees, insurance, customs duties, and related costs.
Where can I learn more?
See Hawaii's Department of Taxation publication Tax Facts 95-1 for specifics.
To be determined.
Does Illinois require sales tax on a tariff fee?
Yes, Illinois generally does require sales tax on tariff fees.
Why?
An Illinois General Information Letter dated 4/7/2025 stated tariff fees passed to customers are part of the selling price, making them non-deductible from the Retailers’ Occupation Tax.
Where can I learn more?
Consult the Illinois Department of Revenue General Information Letter from April 2025 for additional information.
Does Indiana require sales tax on a tariff fee?
Indiana likely requires sales tax on tariff fees.
Why does Indiana likely require sales tax on a tariff fee?
Indiana defines “gross retail income” as the total amount of consideration a retailer receives in a retail transaction—and that’s the amount subject to sales tax. This usually includes all costs and expenses related to the product, like delivery charges.
While Indiana Sales Tax Information Bulletin #92 doesn’t specifically mention tariffs, it does list charges that are not subject to sales tax (such as interest, finance charges, discounts, excise tax, installation, and postage). Since tariff fees don’t fall into any of those excluded categories, it’s likely that they’re considered part of gross retail income—and are therefore taxable.
Where can I go to learn more?
Refer to Indiana Sales Tax Information Bulletin #92 for further details.
Does Iowa require sales tax on a tariff fee?
Yes, Iowa generally does require sales tax on tariff fees.
Why?
Iowa explicitly states that tariff fees added to the final sales price or separately listed in a taxable transaction are subject to Iowa sales or use tax. However, if the underlying product is exempt from tax, then the tariff fee would also be exempt.
Where can I learn more?
Check the Iowa Sales & Use Tax Guide for additional guidance.
Does Kansas require sales tax on a tariff fee?
Yes, Kansas generally does require sales tax on tariff fees.
Why?
Kansas considers tariff fees passed on to customers as part of the taxable selling price, regardless of whether the fees are separately stated or included in the product price.
Where can I learn more?
Consult the Kansas Department of Revenue FAQ About Sales page and K.S.A. 79-3602(ll)(1)(B).
Does Kentucky require sales tax on a tariff fee?
Yes, Kentucky generally requires sales tax on tariff fees.
Why does Kentucky require sales tax on a tariff fee?
Kentucky is a full member of the Streamlined Sales and Use Tax Agreement (SSUTA). Under SSUTA guidance, if an importer passes a tariff fee to a customer as part of the sales price, that fee is treated the same as the product being sold. So, if the product is taxable, the tariff fee is taxable too.
Where can I go to learn more?
You can find the SSUTA guidance on the Streamlined Sales Tax website.
To be determined.
Montana does not have a state sales tax and therefore does not generally require sales tax on a tariff fee.
Does Nebraska require sales tax on a tariff fee?
Yes, Nebraska generally requires sales tax on tariff fees.
Why does Nebraska require sales tax on a tariff fee?
Nebraska is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, if a tariff fee is passed from an importer to the customer as part of the sales price, it’s treated the same as the product being sold. That means if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does Nevada require sales tax on a tariff fee?
Yes, Nevada generally requires sales tax on tariff fees.
Why does Nevada require sales tax on a tariff fee?
Nevada is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, if an importer passes a tariff fee to a customer as part of the sales price, that fee is treated just like the product being sold. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
New Hampshire does not have a state sales tax and therefore does not generally require sales tax on a tariff fee.
Does New Jersey require sales tax on a tariff fee?
Yes, New Jersey generally requires sales tax on tariff fees.
Why does New Jersey require sales tax on a tariff fee?
According to the state, any tariff that a seller passes on to the customer is subject to sales tax—even if the fee is separately listed on the invoice.
Where can I go to learn more?
Visit the Sales Tax Treatment of Tariff Mark Ups page on the New Jersey Division of Taxation website.
To be determined.
To be determined.
Does North Carolina require sales tax on a tariff fee?
Yes, North Carolina generally requires sales tax on tariff fees.
Why does North Carolina require sales tax on a tariff fee?
North Carolina is a full member of the Streamlined Sales Tax (SST) initiative. Under SST guidance, when an importer passes a tariff fee to a customer as part of the sales price, that fee is treated the same as the product being sold. So if the product is taxable, the tariff fee is taxable too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does North Dakota require sales tax on a tariff fee?
Yes, North Dakota generally requires sales tax on tariff fees.
Why does North Dakota require sales tax on a tariff fee?
North Dakota is a full member of the Streamlined Sales Tax (SST) initiative. SST guidance states that if an importer passes a tariff fee to a customer as part of the sales price, that fee should be taxed the same way as the product itself. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does Ohio require sales tax on a tariff fee?
Yes, Ohio generally requires sales tax on tariff fees.
Why does Ohio require sales tax on a tariff fee?
Ohio is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, when an importer includes a tariff fee in the sales price and passes it on to the customer, that fee is treated the same as the product being sold. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does Oklahoma require sales tax on a tariff fee?
Yes, Oklahoma generally requires sales tax on tariff fees.
Why does Oklahoma require sales tax on a tariff fee?
Oklahoma is a full member of the Streamlined Sales Tax (SST) initiative. SST guidance makes it clear that when an importer passes a tariff fee to a customer as part of the sales price, that fee is subject to the same sales and use tax as the product being sold. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Oregon does not have a state sales tax and therefore does not generally require sales tax on a tariff fee.
To be determined.
Does Rhode Island require sales tax on a tariff fee?
Yes, Rhode Island generally requires sales tax on tariff fees.
Why does Rhode Island require sales tax on a tariff fee?
Rhode Island is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, if an importer passes a tariff fee to the customer as part of the sales price, that fee is taxed just like the product being sold. So if the product is subject to sales tax, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does South Carolina require sales tax on a tariff fee?
Yes, South Carolina generally requires sales tax on tariff fees.
Why does South Carolina require sales tax on a tariff fee?
South Carolina includes any tariff fee passed on to a customer as part of the “gross proceeds” of a sale, or what it considers the full sales price. That full amount is subject to sales or use tax unless the tangible personal property being sold is otherwise exempt. This holds true whether the tariff fee is baked into the price or shown as a separate line item on the invoice.
Where can I go to learn more?
You can read more in South Carolina Revenue Ruling #20-4.
Does South Dakota require sales tax on a tariff fee?
South Dakota likely requires sales tax on tariff fees.
Why does South Dakota require sales tax on a tariff fee?
According to the state, sales tax applies to the gross receipts from all retail sales. That includes the sale, lease, or rental of tangible personal property, electronically delivered products, and services. Based on our communication with South Dakota’s tax authorities, it’s reasonable to expect that tariff fees would be included in gross receipts and therefore be subject to tax.
Where can I go to learn more?
You can review the South Dakota Sales Tax Facts for a breakdown of what counts as gross receipts.
To be determined.
Does Texas require sales tax on a tariff fee?
Yes, Texas generally requires sales tax on tariff fees.
Why does Texas require sales tax on a tariff fee?
According to a General Information Letter (GIL20250604072421), Texas considers a tariff fee to be part of the total sales price—and therefore subject to sales tax. If the seller passes the tariff fee on to the customer, it gets included in the taxable amount.
Where can I go to learn more?
You can review the definition of “sales price” in the Texas Tax Code, Section 151.007(a)(2), (4), and (b). Additional guidance is available on the Texas Taxes webpage.
Does Utah require sales tax on a tariff fee?
Yes, Utah generally requires sales tax on tariff fees.
Why does Utah require sales tax on a tariff fee?
Utah is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, if an importer passes a tariff fee to a customer as part of the sales price, that fee is treated the same as the product being sold. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does Vermont require sales tax on a tariff fee?
Yes, Vermont generally requires sales tax on tariff fees.
Why does Vermont require sales tax on a tariff fee?
Vermont is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, when an importer passes a tariff fee to a customer as part of the sales price, that fee is treated the same as the product being sold. If the product is taxable, the tariff fee is taxable, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
To be determined.
Does Washington require sales tax on a tariff fee?
Yes, Washington generally requires sales tax on tariff fees.
Why does Washington require sales tax on a tariff fee?
Washington makes it clear that tariff fees—whether they’re built into the product price or listed separately on the invoice—cannot be deducted from the selling price. If the transaction qualifies as a taxable retail sale, the seller must collect sales tax on the total price, including any tariff fees.
Where can I go to learn more?
Visit the Washington Department of Revenue website for detailed information on surcharges, including tariffs.
Does West Virginia require sales tax on a tariff fee?
Yes, West Virginia generally requires sales tax on tariff fees.
Why does West Virginia require sales tax on a tariff fee?
West Virginia is a full member of the Streamlined Sales Tax (SST) initiative. SST guidance explains that if an importer includes a tariff fee in the sales price and passes it on to the customer, that fee is subject to the same sales and use tax as the product itself. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
Does Wisconsin require sales tax on a tariff fee?
Yes, Wisconsin generally requires sales tax on tariff fees.
Why does Wisconsin require sales tax on a tariff fee?
According to the state, tariffs—whether they’re included in the product’s selling price or listed separately on the invoice—are subject to Wisconsin sales and use tax. The state makes it clear that these fees are considered part of the taxable sales price.
Where can I go to learn more?
You can read more in Wisconsin Tax Bulletin Number 205 (April 2019).
Does Wyoming require sales tax on a tariff fee?
Yes, Wyoming generally requires sales tax on tariff fees.
Why does Wyoming require sales tax on a tariff fee?
Wyoming is a full member of the Streamlined Sales Tax (SST) initiative. According to SST guidance, if a tariff fee is passed from an importer to the customer as part of the sales price, it’s subject to the same sales and use tax as the product being sold. So if the product is taxable, the tariff fee is, too.
Where can I go to learn more?
You can find the SST guidance on the Streamlined Sales Tax website.
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