The City of Surprise tax rate on most retail purchases is 9.1% combined, with 2.8% of that going to the city itself. Arizona adds 5.6% and Maricopa County adds 0.7% on top of the city’s share.1Arizona Department of Revenue. Surprise Transaction Privilege Tax and Use Tax Rates Restaurants, construction, and short-term lodging carry higher rates, and Surprise also levies a property tax and a use tax.
How the 9.1% Breaks Down
Three separate governments stack their rates to produce the number on your receipt. The state takes 5.6%, Maricopa County takes 0.7%, and the City of Surprise takes 2.8% for standard retail.1Arizona Department of Revenue. Surprise Transaction Privilege Tax and Use Tax Rates The city’s 2.8% rate took effect October 1, 2024.
The Arizona Department of Revenue collects the transaction privilege tax (TPT) on behalf of Surprise, so businesses remit through the state rather than the city. Any business selling taxable goods or services inside city limits needs a TPT license from the Department of Revenue in addition to a city business license.2Arizona Department of Revenue. TPT License
Rates by Business Type
The 2.8% city rate covers most activities, but a few classifications are taxed higher.1Arizona Department of Revenue. Surprise Transaction Privilege Tax and Use Tax Rates
- General retail (including marijuana retail): 2.8% city, 9.1% combined.
- Restaurants and bars: 3.2% city, 9.5% combined.
- Construction contracting (prime contractors, speculative builders, owner-builders): 3.7% city, 10.0% combined.
- Amusements, including theaters, concerts, sporting events, golf, and fitness: 2.8% city, 9.1% combined.
- Communications and utilities, including telephone, internet, electricity, gas, and water: 2.8% city, 9.1% combined.
- Commercial rental of real property: 2.8% city, 9.1% combined.
- Rental of personal property, such as equipment, vehicles, tools, and furniture: 2.8% city, 9.1% combined.
What Isn’t Taxed
Food purchased for home consumption is fully exempt from the Surprise city tax, an exemption the city enacted on April 1, 2004.1Arizona Department of Revenue. Surprise Transaction Privilege Tax and Use Tax Rates Arizona also exempts groceries at the state level, so unprepared food bought at a grocery store carries no TPT at all. Prepared food from restaurants and bars is taxed at the 3.2% city rate.
Residential rentals are also no longer taxed. Surprise reduced its residential rental TPT to 0% effective January 1, 2025, following Arizona Senate Bill 1131.1Arizona Department of Revenue. Surprise Transaction Privilege Tax and Use Tax Rates Under A.R.S. ยง 42-6004(H), no city, town, or taxing jurisdiction in Arizona may levy any TPT, sales tax, use tax, or similar fee on the business of renting real property for residential purposes.3Arizona Department of Revenue. Residential Rental Guidelines Landlords who had been passing the tax through to tenants were required to stop as of that date. The separate rental occupancy tax was also reduced to 0% on January 1, 2025.
Short-Term Lodging Is Taxed the Highest
Hotels, motels, and vacation rentals where guests stay fewer than 30 consecutive days face the steepest combined rate in Surprise.4Arizona Legislature. Arizona Code 42-5070 – Transient Lodging Classification; Definition The base 2.8% hotel rate is joined by an additional transient lodging tax of 4.52%, pushing the city-level total to 7.32%.5City of Surprise. Hotel Motel and Transient Lodging Transaction Privilege Tax Brochure With state and county added, a short-term guest in Surprise pays a combined lodging tax of roughly 13.6%.
If you host on a vacation rental platform and your guests book stays shorter than 30 days, these rates apply to your gross rental income. Stays of 30 consecutive days or more fall under a different classification.
Property Tax
Surprise property owners pay a primary city property tax of $0.5534 per $100 of assessed limited property value. The city also levies a secondary property tax tied to voter-approved general obligation bonds that fund infrastructure and public safety facilities.6City of Surprise, AZ. Property Tax
Those city rates are only one slice of a Surprise property tax bill. The Maricopa County Assessor sets the limited property value, and the county, community college districts, school districts, and special districts like fire or flood control each add their own rates. Two homes a few blocks apart can face different totals depending on which districts cover them.
The Maricopa County Treasurer handles billing. The first installment is due October 1 and becomes delinquent after 5:00 PM on November 1. The second is due March 1 and becomes delinquent after 5:00 PM on May 1. If the annual total is under $100, the full amount is due by November 1.7Maricopa County. Maricopa County Property Tax
Use Tax on Out-of-State Purchases
The Surprise use tax rate matches the standard retail rate at 2.8%, and it applies whenever you buy from an out-of-state seller that didn’t collect the city’s TPT.1Arizona Department of Revenue. Surprise Transaction Privilege Tax and Use Tax Rates Order equipment, materials, or other tangible property from a vendor outside Arizona and bring it into Surprise for use, and the use tax closes the gap. Businesses buying inventory or supplies from vendors that don’t collect Arizona TPT at checkout need to account for it on their own returns.