Delaware does not have a personal property tax. State law bans it outright, and a separate statute extends the same ban to every county, city, and town. If you own business equipment, vehicles, furniture, inventory, or any other tangible personal property in Delaware, no government entity in the state can tax it. There are no exemptions to apply for, no filing deadlines to track, and no assessment disputes to navigate.
The Statutory Ban
Two statutes do the work. Title 30 § 102(a) of the Delaware Code says the state cannot levy, assess, or collect any tax on personal property, tangible or intangible.1Delaware Code Online. Delaware Code Title 30 – General Provisions Title 9 § 8103 mirrors that prohibition for every county and political subdivision, barring them from levying, assessing, or collecting any tax on personal property of any kind.2Justia. Delaware Code Title 9 8103 – Personal Property
Those parallel statutes close a door that stays open in many other states. No Delaware city or county can create its own personal property tax through local ordinance. The ban is absolute.
The One Exception: Improvements on Leased Land
Title 30 § 102(b) carves out a narrow exception that occasionally causes confusion. The ban does not affect the taxation of buildings, improvements, equipment, or structures erected on land held under a lease, nor does it affect poles or wires maintained on such land.1Delaware Code Online. Delaware Code Title 30 – General Provisions This is a real property assessment issue, not a personal property one. If you put up a warehouse or install permanent fixtures on leased ground, those improvements can be assessed as real property. Movable business assets like machinery, computers, and office furniture remain untaxed whether they sit on owned or leased land.
What Delaware Businesses Actually Pay
The absence of a personal property tax does not mean operating in Delaware is tax-free. If you’re asking about personal property tax, you’re probably really trying to map out your full Delaware tax picture. Here is what applies.
Gross Receipts Tax
Delaware has no sales tax, but it imposes a gross receipts tax on businesses for the privilege of doing business in the state. The tax hits total gross revenues rather than profits, with rates currently ranging from 0.0945% to 2.4218% depending on the type of business activity.3Division of Revenue – State of Delaware. Gross Receipts Tax FAQs Retailers, manufacturers, wholesalers, and service providers each face different schedules. For high-volume, low-margin businesses, this can be a significant line item.
Corporate Income Tax
Corporations doing business in Delaware pay an 8.7% corporate income tax on their share of federal taxable income allocated and apportioned to the state. The apportionment formula uses equally weighted property, wages, and sales factors to determine how much of a company’s income is attributable to Delaware.4Division of Revenue – State of Delaware. Filing Corporate Income Tax
Franchise Tax
Delaware’s franchise tax is the obligation most companies incorporated in the state recognize by name. Domestic corporations can calculate it under either the authorized shares method or the assumed par value capital method, and pay whichever produces the lower amount. The authorized shares method starts at a minimum of $175 for companies with 5,000 shares or fewer and scales upward. The assumed par value capital method runs $400 per million dollars of assumed par value capital, with a $400 minimum. Both cap at $200,000 per year, though large corporate filers face a $250,000 ceiling. Annual reports and franchise tax payments are due by March 1, and missing that deadline triggers a $200 penalty plus 1.5% monthly interest on the unpaid balance.5Division of Corporations. Annual Report and Tax Information
LLCs, limited partnerships, and general partnerships formed or registered in Delaware pay a flat $300 annual tax, due by June 1. These entities don’t file annual reports with the Division of Corporations, but the tax still applies. The same $200 penalty and 1.5% monthly interest apply if the deadline slips.6Division of Corporations. LLC/LP/GP Franchise Tax Instructions
Business Licenses
Every business operating in Delaware needs a state business license, obtained through the state’s One Stop registration system.7Division of Revenue – State of Delaware. Step 3 – Licensing and Registration Information Some municipalities add their own. Wilmington requires a separate city business license and charges a head tax of $15 per month for every employee beyond the first five.8City of Wilmington. Doing Business in the City of Wilmington
Real Property Tax
Personal property escapes taxation entirely. Real property does not. Delaware counties tax land and buildings, and this is the tax most owners encounter directly. All real property must be assessed at fair market value as of the most recent reassessment base year, and counties are required to reassess at least once every five years.9Delaware Code Online. Delaware Code Title 9 Chapter 83 – Valuation and Assessment of Property
Rates vary significantly by location. In New Castle County for fiscal year 2026, residential rates run from $0.0432 per $100 of assessed value in Newark and Wilmington to $0.1575 in unincorporated areas. Non-residential rates run higher, from $0.0653 per $100 in Newark and Wilmington up to $0.2380 in unincorporated areas.10New Castle County. New Castle County Property Tax Rates for Fiscal Year 2026 Municipalities may add their own property tax on top of the county rate.
Where the Confusion Comes From
Most of the confusion around a Delaware personal property tax comes from three places.
Many other states tax business equipment, vehicles, and inventory at the local level, so business owners moving into Delaware or operating across state lines assume the same rules apply. They don’t.
Delaware’s gross receipts tax on leasing tangible personal property sometimes gets mistaken for a property tax on the equipment itself. Motor vehicle dealers, for example, pay a lessor gross receipts tax of 0.288% on lease revenue and must collect a 1.92% use tax from lessees. That is a transaction-based tax, not a property tax on the vehicle.11Delaware Division of Motor Vehicles. Dealer Services
And the real property tax on improvements built on leased land under § 102(b) occasionally leads people to think personal property sitting on leased premises is taxable. Only the permanent structures are.
If you’re moving business equipment into Delaware from a state that does levy personal property taxes, the transition is simple: you stop paying those taxes once the equipment is in Delaware. There is no Delaware use tax on tangible personal property either, since Delaware doesn’t have a general sales or use tax. For equipment-heavy operations previously subject to annual personal property assessments elsewhere, the savings can be substantial.