The Maricopa County sales tax starts at a combined 6.3% before any city rate is added: 5.6% to the state and 0.7% to the county. Arizona doesn’t actually call it a sales tax. The state’s version is the transaction privilege tax (TPT), and it’s legally imposed on the business for the privilege of operating in Arizona rather than on the customer at the register.1Arizona Department of Revenue. Transaction Privilege Tax The Arizona Department of Revenue collects it and distributes the money back to the state, county, and cities. The practical effect looks like a sales tax, since most businesses pass the cost through on receipts, but the legal responsibility sits with the seller either way.
How the Rate Is Built
Three layers combine to produce what a Maricopa County business collects on a typical retail sale.
- State rate — 5.6%. Arizona’s base TPT is 5% under ARS 42-5010, with an additional 0.6% surcharge in effect from July 2021 through June 2041.2Arizona Legislature. Arizona Revised Statutes 42-5010 – Rates; Distribution Base3Arizona Legislature. Arizona Revised Statutes 42-5010.01 – Transaction Privilege Tax; Additional Rate Increment
- County rate — 0.7%. Maricopa County layers its own 0.7% on retail transactions. The largest piece is a half-cent transportation excise tax that voters extended through 2045 under Proposition 479 in November 2024.4Arizona Department of Revenue. Transaction Privilege and Other Tax Rate Tables – Effective January 1, 20265Maricopa Association of Governments. Ready to Roll: Positive Impacts of Prop 400 Realized
- City rate — varies. Each municipality sets its own addition on top of the 6.3% floor. Combined totals typically land somewhere between roughly 8% and over 10%, depending on the city and the type of activity.
Unincorporated parts of the county stop at the 6.3% floor. The moment a sale happens inside a city’s limits, that city’s rate loads on top.
Rates Change by Business Activity
Not every transaction uses the retail rate. TPT is organized by business classification, and each classification carries its own rate. Transient lodging — hotels, motels, and short-term rentals booked for fewer than 30 consecutive days — runs 7.27% at the combined state and county level before any city surcharge is added. Commercial leasing at the county level is only 0.5%.4Arizona Department of Revenue. Transaction Privilege and Other Tax Rate Tables – Effective January 1, 2026 Amusement businesses (concerts, sporting events, bowling alleys, golf courses, arcades) owe TPT on admissions and user fees.6Arizona Department of Revenue. Amusements – Publication 604 Personal property rental, restaurant and bar sales, and prime contracting each have their own rules. Before filing or quoting a customer, check the Department of Revenue rate table for the specific business code and jurisdiction.
Origin-Based Sourcing
Because TPT taxes the privilege of doing business at a location, Arizona generally applies origin-based sourcing on in-state sales. A shop in Scottsdale charges the Scottsdale combined rate even when the customer drives in from Tempe. Where the buyer lives doesn’t change the rate; where the seller operates does. Remote sellers shipping into Arizona from out of state follow a different set of rules, covered further down.
What’s Exempt
Groceries
Arizona exempts most unprepared food from the state’s 5.6% TPT. The exemption tracks federal food-assistance definitions and covers items like produce, meat, bread, and packaged snacks.7Arizona Legislature. Arizona Revised Statutes 42-5061 – Retail Classification; Definitions It only removes the state portion. Most Maricopa County cities still tax groceries at the local level, with Phoenix and Mesa being notable exceptions. Prepared food, including hot meals, catered food, and anything served with utensils for on-site consumption, stays fully taxable.
Resale Purchases
Businesses buying inventory for resale don’t owe TPT on those purchases, but they need paper to prove it. The Arizona Resale Certificate (Form 5000A) is filled out by the buyer and kept on file by the seller.8Arizona Department of Revenue. Arizona Resale Certificate – Form 5000A A seller who accepts it in good faith is relieved of liability if the buyer later turns out to have been ineligible. Certificates can cover a single sale or a period up to 48 months, provided the vendor confirms the buyer’s TPT license remains valid each calendar year.
If goods bought tax-free with a resale certificate end up being used by the business instead of resold, use tax is owed on the purchase price. Intentional misuse of a resale certificate to dodge tax is a class 4 felony under ARS 42-1127.9Arizona Legislature. Arizona Revised Statutes 42-1127 – Criminal Violation; Classification; Place of Trial; Definitions
Use Tax on Out-of-State Purchases
Use tax is the companion to TPT. When you buy tangible personal property from an out-of-state seller that didn’t collect Arizona TPT, you owe use tax on that item at the same rate TPT would have applied.10Arizona Legislature. Arizona Revised Statutes 42-5155 – Levy of Tax; Tax Rate; Purchaser’s Liability The 0.6% surcharge applies here as well, through June 2041. It comes up most often for businesses ordering supplies, equipment, or raw materials from out-of-state vendors. Individuals technically owe it on untaxed online purchases too, though enforcement against individuals is far less common than against businesses. Use tax is self-reported on the TPT return through AZTaxes.gov.
If You Run a Business: License, File, Pay
Any business conducting taxable activity in Maricopa County needs a TPT license before its first sale. Registration runs through the Joint Tax Application (Form JT-1), filed online through AZTaxes.gov or on paper.11Arizona Department of Revenue. Joint Tax Application for a TPT License The same form handles state TPT, county and city TPT, and employer withholding and unemployment insurance when those apply. Choosing the correct business activity code during registration matters: the wrong code can lead to the wrong rate being charged and problems during an audit.
How Often to File
Filing frequency depends on estimated annual TPT liability across all state, county, and city obligations:12Arizona Department of Revenue. TPT Update – January 2026
- Annual filing if liability is under $2,000
- Quarterly if between $2,000 and $8,000
- Monthly if over $8,000
Changing frequency requires a Business Account Update, and the Department won’t approve the change if the account has any delinquencies.
Due Dates
Returns and payments are due on the 20th of the month after the reporting period closes.13Arizona Legislature. Arizona Revised Statutes 42-5014 – Return and Payment of Tax; Estimated Tax; Extensions A Q1 return is due April 20. Annual filers have until the 20th of the month after their tax year ends. Businesses filing and paying electronically through AZTaxes.gov or approved tax software get extra time: electronic submissions are treated as timely if received by the last business day of the month.14Arizona Department of Revenue. E-Services for TPT ACH and credit card payments are both accepted, though credit card payments usually carry a processing fee.
Penalties and Interest
Arizona separates late filing from late payment:
- Late filing: 4.5% of the tax due per month or partial month, up to 25%.15Arizona Legislature. Arizona Revised Statutes 42-1125 – Civil Penalties; Definition
- Late payment: 0.5% of the unpaid tax per month, capped at 10%. When both penalties hit the same period, the combined total can’t exceed 25%.
Unpaid balances also accrue interest, compounded annually at the federal short-term rate plus three percentage points. For the first half of 2026, that works out to 7% from January through March and 6% from April through June.16Arizona Department of Revenue. Interest Rates Interest is added to outstanding principal on January 1 each year. Filing or paying stops the penalty clock, but interest keeps running until the full balance clears. The Department can waive penalties if you show reasonable cause and the delay wasn’t willful neglect, but it cannot waive the interest.
If You Sell Into Arizona From Out of State
Out-of-state businesses must register and collect Arizona TPT once gross retail sales into Arizona exceed $100,000 in the current or previous calendar year.17Arizona Department of Revenue. Out-of-State Sellers Arizona uses a dollar threshold only; there is no separate transaction-count trigger. Once a remote seller crosses the line, collection must start by the first of the month beginning at least 30 days after the threshold is met.
Sales made through a marketplace facilitator that already collects and remits TPT on your behalf don’t count toward the $100,000 threshold. If every Arizona sale flows through a platform like Amazon or Etsy and the platform handles the tax, independent registration may not be needed. Sell through both a marketplace and your own site, and only the marketplace-facilitated portion gets excluded from the calculation.