Ohio’s 7.25% sales tax rate applies in roughly 50 counties and reflects the state’s 5.75% base tax plus a 1.5% local add-on. If you’re shopping or selling in one of those counties, that rate covers most tangible goods, a surprisingly wide list of services, and most digital products, while groceries, prescription drugs, and durable medical equipment stay exempt.
What Makes Up the 7.25% Rate
Every sale in Ohio starts with the statewide 5.75% tax set by Ohio Revised Code 5739.02.1Ohio Legislative Service Commission. Ohio Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions Counties and transit authorities add their own tax in increments of 0.05%.2Ohio Legislative Service Commission. Ohio Code 5739.021 – Additional Sales Tax Levied by County At 7.25%, the local slice is exactly 1.5%.
How that 1.5% is assembled varies. In most 7.25% counties, the county levies the full 1.5% itself. In others, such as Lake County, it splits as 1.0% county plus a 0.5% transit authority levy.3Ohio Department of Taxation. Total State and Local Sales Tax Rates by County The split is invisible at the register but matters when a business allocates collected tax on a return.
Ohio caps local add-ons at 3%, so no jurisdiction exceeds 8.75%.4Ohio Department of Taxation. Sales and Use Tax At 7.25%, these counties sit in the middle of the range.
What You Pay 7.25% On
Physical Goods
Ohio taxes tangible personal property, defined as anything that can be seen, weighed, measured, felt, or touched.5Ohio Legislative Service Commission. Ohio Code 5739.01 – Sales Tax Definitions Furniture, electronics, and clothing all qualify. Motor vehicles are taxable too, but the tax is collected by the county clerk of courts at title transfer rather than at the dealership.6Ohio Department of Taxation. Sales Tax for Motor Vehicles, Watercraft, and Aircraft
Services
Ohio taxes a broader range of services than most people expect. In a 7.25% county, the full rate applies to:
- Repair and installation work, covering both labor and materials
- Landscaping and lawn care, when the provider earns $5,000 or more annually from these services
- Telecommunications, including cellular and landline plans plus related fees like voicemail and caller ID
- Private investigation and security services
- Personal care such as massages, tattoos, manicures, and tanning
- Gym and fitness memberships
- Building cleaning and janitorial services, when the provider earns $5,000 or more annually
- Hotel stays under 30 days in facilities with five or more sleeping rooms
That $5,000 annual-revenue threshold for landscaping and cleaning catches some small operators off guard. A part-time landscaper who crosses it mid-year becomes responsible for collecting and remitting sales tax going forward.7Ohio Department of Taxation. Sales and Use Taxability
Digital Products and Software
Ohio treats most digital products the same as their physical equivalents. Streaming services like Netflix and Hulu, downloadable e-books, music, movies, and prewritten computer software are all taxable.7Ohio Department of Taxation. Sales and Use Taxability Cloud-based software subscriptions and business data processing services also carry the tax. Custom software built exclusively for a single client is the notable exception, provided the charges are separately stated on the invoice.
What’s Exempt from the 7.25%
Even in a 7.25% county, many routine purchases carry no sales tax. Ohio Revised Code 5739.02(B) sets out a long list of exemptions.1Ohio Legislative Service Commission. Ohio Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions The ones most people encounter:
- Groceries, meaning food purchased for off-premises consumption. Soft drinks, dietary supplements, and alcoholic beverages do not qualify and are taxed at the full rate.
- Prescription drugs, insulin, and blood or urine testing supplies for diabetics.8Ohio Department of Taxation. ST 2003-10 – Sales Tax Exemptions for Drugs and Medical Equipment
- Durable medical equipment such as hospital beds, wheelchairs, medical oxygen equipment, and prosthetic devices purchased with a prescription for home use.
- Sales to churches, charities, and public schools, when the items serve the organization’s exempt purpose.
Businesses get exemptions too. Equipment used more than 50% of the time in manufacturing qualifies, as do goods purchased for resale when the buyer provides a valid exemption certificate. The manufacturing exemption extends to production machinery, materials-handling equipment within a continuous operation, and utilities when more than half of consumption goes to qualifying production.
The Annual Sales Tax Holiday
Ohio suspends sales tax statewide for one weekend each summer. In 2026, the back-to-school holiday runs from 12:00 a.m. Friday, August 7 through 11:59 p.m. Sunday, August 9. During that window, three categories are exempt:
- Clothing priced at $75 or less per item
- School supplies priced at $20 or less per item
- School instructional materials priced at $20 or less per item
There is no expanded holiday on items $500 and under in 2026.9Ohio Department of Taxation. Ohio Sales Tax Holiday The exemption covers in-store and online purchases shipped to an Ohio address.
Shipped Orders and Use Tax
The rate you pay depends on where you receive the product, not where the seller is located. Ohio Revised Code 5739.033 establishes destination-based sourcing.10Ohio Legislative Service Commission. Ohio Code 5739.033 – Location of Sale Walk into a store in a 7.25% county and leave with the item, and that rate applies. Order online to a 7.25% address, and the retailer should charge 7.25% regardless of where it ships from. Order from a 7.25% county to a lower-rate address, and the lower rate applies.
If an out-of-state retailer doesn’t collect Ohio tax, you still owe the equivalent as consumer use tax at your home rate. For someone in a 7.25% jurisdiction, that’s 7.25% use tax on untaxed purchases.4Ohio Department of Taxation. Sales and Use Tax Most large online retailers now collect Ohio tax automatically under economic nexus rules, but smaller out-of-state vendors, private sellers, and purchases made while traveling can still arrive untaxed. Ohio provides a consumer use tax account for reporting what you owe directly.
If You’re the One Collecting the 7.25%
Before collecting any sales tax, an Ohio business needs a vendor’s license from the county where it operates. As of April 2025, the fee for a new permanent vendor’s license is $50.11Ohio Department of Taxation. Vendors License Fee Change Coming Soon Transient vendors selling at fairs or festivals need a separate license.
Filing frequency depends on volume. Vendors whose tax liability stays below $1,200 per six-month period can file semi-annually; everyone else files monthly, with returns due by the 23rd of the following month. Businesses with annual tax liability above $75,000 must submit payments electronically.4Ohio Department of Taxation. Sales and Use Tax
Ohio rewards timely filers with a 0.75% discount on tax due, capped at $750 per vendor’s license per month. Motor vehicle dealers are exempt from the cap.12Ohio Legislative Service Commission. Ohio Code 5739.12 – Filing Returns For a business in a 7.25% county collecting steady tax, the discount is worth protecting by filing on time. Late returns carry a flat $50 penalty. Late payments trigger a 5% penalty within 30 days, 10% after 30 days, with another 10% possible if the Department of Taxation issues a notice and payment still doesn’t arrive by the specified date. Interest accrues at 7.0% annually for 2026.13Ohio Department of Taxation. Annual Certified Interest Rates