The Buncombe County sales tax rate is 7%. That combines North Carolina’s 4.75% state rate with a 2.25% local rate, and it applies to most retail purchases made in the county, including Asheville.1North Carolina Department of Revenue. Current Sales and Use Tax Rates Buncombe does not add a transit tax, so 7% is the full rate on a standard taxable sale.
What You Pay 7% On
The full rate applies to most tangible goods you buy at a store or online: clothing, electronics, furniture, appliances, and similar merchandise.2North Carolina Department of Revenue. Taxable Items Digital products are taxed at the same 7%, whether downloaded or streamed, and that covers digital audio, video, e-books, and electronic magazines.3North Carolina General Assembly. North Carolina General Statutes 105-164.4 – Tax Imposed on Retailers and Certain Facilitators
Prepared food is taxed at the full 7% as well, so restaurant meals, takeout, and anything sold ready to eat carry the standard rate.4North Carolina Department of Revenue. Food, Non-Qualifying Food, and Prepaid Meal Plans A handful of services also fall under the 7% rate, including dry cleaning, laundry, linen rental, and satellite radio subscriptions.2North Carolina Department of Revenue. Taxable Items
What Gets Taxed Differently
Groceries
Unprepared food is subject to only a 2% local tax. The state’s 4.75% share does not apply.4North Carolina Department of Revenue. Food, Non-Qualifying Food, and Prepaid Meal Plans As soon as food is heated, served with utensils, or sold ready to eat, it crosses into the prepared category and gets taxed at 7%. That line catches people at deli counters, bakery cases, and hot-food bars.
Cars, Trucks, and Motorcycles
Vehicles are not taxed at the sales tax rate at all. North Carolina applies a separate 3% highway use tax when a certificate of title is issued, and that tax caps at $2,000 for commercial vehicles and recreational vehicles.5North Carolina General Assembly. North Carolina Code Chapter 105 – Article 5A Short-term vehicle rentals are taxed at 8%; long-term leases, at 3%.
Prescription Drugs and Medical Equipment
Prescription medications, insulin, and over-the-counter drugs dispensed on prescription are exempt from state and local sales tax. The exemption also covers prosthetic devices, prescribed durable medical equipment, breast pumps, and related supplies.6North Carolina General Assembly. North Carolina General Statutes 105-164.13 – Exemptions
Hotel Rooms and Short-Term Rentals
Lodging carries the heaviest combined rate in the county. On top of the 7% sales tax, Buncombe County adds a 6% occupancy tax on gross room rental receipts for any room, lodging, or accommodation furnished by a hotel, motel, inn, or similar business.7Buncombe County North Carolina. Occupancy Tax The combined tax on a stay runs 13%.
Online and Out-of-State Purchases
Buying something online or from an out-of-state seller doesn’t avoid the tax. If a retailer doesn’t charge North Carolina sales tax at checkout, you owe use tax at the same 7% rate on anything that would have been taxable in a store in Asheville. Most large online retailers and marketplace platforms collect automatically, but smaller sellers sometimes don’t. When tax wasn’t collected, you report and pay it yourself, typically on your North Carolina individual income tax return.
If You’re a Business Collecting the Tax
Sellers register with the North Carolina Department of Revenue and file returns using Form E-500 through the state’s electronic filing system.8North Carolina Department of Revenue. Form E-500, Sales and Use Tax Return Filing frequency depends on how much tax you collect each month:9North Carolina Department of Revenue. Filing Frequency and Due Dates
- Quarterly if your liability consistently runs below $100 per month.
- Monthly if your liability falls between $100 and $20,000 per month.
- Monthly with prepayment if you collect $20,000 or more per month.
Keep records that support what you collected and remitted for at least three years, including transaction logs and any exemption certificates you accepted.10North Carolina Department of Revenue. SUPLR 2013-0003 – Maintaining Purchase Records in Digital Format Late filing and late payment each carry their own penalties, and interest accrues on any unpaid balance from the original due date.11North Carolina General Assembly. North Carolina General Statutes 105-236 – Penalties Collecting sales tax from customers and failing to remit it is treated as a high enforcement priority by the state.12North Carolina Department of Revenue. Penalties and Fees Overview