Items exempt from sales tax in Ohio fall into a few main groups: unprepared groceries, prescription drugs and prescribed medical equipment, most services, sales to government and qualifying nonprofits, machinery used directly in manufacturing or farming, and almost anything priced at $500 or less during the state’s annual August tax holiday.1Ohio Legislative Service Commission. Ohio Revised Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions The state rate is 5.75%, and county and transit surcharges can push the combined rate as high as 8.75%, so the exemptions matter more than the headline rate suggests.2Ohio Department of Taxation. Sales and Use Tax A few things people expect to find on the exempt list, like clothing and over-the-counter medicine, are not there.
Groceries and Food for Home Consumption
Food sold for human consumption off the premises where it’s purchased is exempt.1Ohio Legislative Service Commission. Ohio Revised Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions The “off-premises” piece is the whole game. A raw chicken you take home is tax-free. A rotisserie chicken you eat at the deli counter is taxable, because at that point you’re buying a prepared meal.
Ohio’s statutory definition of food is narrower than people assume. Alcoholic beverages, soft drinks, dietary supplements, and tobacco are specifically excluded and remain fully taxable.3Ohio Department of Taxation. Food Service Industry “Soft drink” means any non-alcoholic beverage with natural or artificial sweeteners, which pulls in energy drinks and sweetened teas alongside soda. Anything sold heated, or served with utensils the seller provides, is treated as prepared food and loses the exemption.1Ohio Legislative Service Commission. Ohio Revised Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions
Bottled water counts as exempt food, including mineral, carbonated, and distilled varieties. Sweetened water is the exception: add natural or artificial sweeteners and Ohio reclassifies it as a soft drink.4Ohio Department of Taxation. Sales and Use Tax Information Release ST 2004-01
Prescription Drugs and Prescribed Medical Equipment
Prescription drugs dispensed by a licensed pharmacist are entirely exempt. So are insulin, blood and urine testing supplies used by diabetics or people with hypoglycemia, and hypodermic syringes used for insulin injections.5Ohio Legislative Service Commission. Section 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions Over-the-counter medicine, however, is taxable. If you don’t need a prescription to buy it, Ohio charges tax on it.
A separate exemption covers prosthetic devices, durable medical equipment for home use, and mobility-enhancing equipment such as power wheelchairs and patient lifts. These items qualify only when purchased with a prescription. Without a prescription on file, the seller has to charge tax. Hospital beds and medical oxygen equipment are exempt only when the buyer is a hospital, nursing home, or similar medical facility, not an individual purchasing directly.5Ohio Legislative Service Commission. Section 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions
Clothing Is Not Exempt
Ohio does not exempt clothing. It’s treated as ordinary tangible personal property and taxed at the full combined state and local rate. Anyone used to shopping tax-free on clothing in Pennsylvania or New Jersey gets caught by this. The only clothing-related carve-out is for period underwear, period swimwear, period running shorts, and period sleep shorts designed for menstrual hygiene.6Ohio Department of Taxation. Sales and Use – Applying the Tax
Most Services
Ohio’s sales tax is built around tangible personal property. A service is taxable only if the legislature specifically listed it in the statute, and that list is finite.7Ohio Legislative Service Commission. Ohio Revised Code 5739.01 – Sales Tax Definitions Professional services sit outside the tax entirely: legal advice, accounting, consulting, therapy, and medical procedures performed by physicians generate no sales tax. You’re paying for expertise and labor, not buying a product.
Services that Ohio does tax include repair and installation of taxable property, car washing and detailing, laundry and dry cleaning, landscaping and lawn care, telecommunications, data processing, personal care services like manicures and massage, janitorial work, extermination, gym and recreation memberships, private security, and satellite broadcasting. Anything not on that list is not taxable. One nuance: personal care services such as massage and tattooing are generally taxable, but when performed by or on the order of a licensed physician, certified nurse-midwife, or clinical nurse specialist, they are exempt.8Ohio Legislative Service Commission. Section 5739.01 – Sales Tax Definitions
Digital Products Are Mostly Taxable
Most digital purchases in Ohio are taxable, which surprises people who assume anything delivered electronically is tax-free. Streaming subscriptions like Netflix and Hulu, music downloads, e-books, and prewritten computer software (on disc or downloaded) all carry sales tax, whether you own the content permanently or just subscribe.9Ohio Department of Taxation. Sales and Use Tax – Digital Products
A short list of digital items is carved out. Electronically delivered photos, magazines, and newspapers are not part of Ohio’s definition of taxable digital products and remain tax-free. Digital products delivered through a cable television system also fall outside the tax.9Ohio Department of Taxation. Sales and Use Tax – Digital Products
The Annual Sales Tax Holiday
Ohio holds a sales tax holiday each year, typically beginning the first Friday of August. During the holiday, all tangible personal property priced at $500 or less per item is exempt from state and local sales tax.10Ohio.gov. Annual Sales Tax Holiday That’s much broader than the holidays in most other states, which cap the exemption at school supplies or clothing. In Ohio, electronics, furniture, appliances, and tools all qualify as long as each item rings up at $500 or less.
A few categories are excluded no matter the price: motor vehicles, watercraft and outboard motors that require Ohio titles, alcoholic beverages, tobacco, and vapor products.11Ohio Legislative Service Commission. Chapter 5739 – Sales Tax The length and dates shift from year to year. The 2025 holiday ran August 1 through 14, a full two weeks.10Ohio.gov. Annual Sales Tax Holiday Whether the holiday happens at all depends on the state’s Director of Budget and Management certifying a budget surplus in the preceding fiscal year. No surplus, no holiday. The 2026 dates had not been announced at the time of writing.
Exemptions Tied to the Buyer or the Use
Some exemptions depend on who is buying or what the item will be used for, not the item itself.
Sales to the State of Ohio or its political subdivisions (counties, cities, school districts) are exempt, as are sales to qualifying nonprofits including churches, charities, and educational institutions.1Ohio Legislative Service Commission. Ohio Revised Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions The burden sits with the buyer: a valid exemption certificate must be given to the vendor at the time of purchase. Ohio uses a Unit Exemption Certificate for one-time purchases and a Blanket Exemption Certificate for ongoing purchases from the same vendor.12Ohio Department of Taxation. Exemption Certificate Forms
Machinery and equipment used directly in manufacturing to produce goods for sale are exempt, along with parts, repair services for that equipment, and the fuel or power used to run production machinery.13Ohio Department of Taxation. Understanding the Manufacturing Sales Tax Exemption “Directly” is the operative word. Office furniture or breakroom supplies at a factory don’t qualify because they only indirectly support the production operation. Items used primarily in farming, including seeds, fertilizers, and fuel for farm equipment, are similarly excluded from the sales tax base.1Ohio Legislative Service Commission. Ohio Revised Code 5739.02 – Levy of Sales Tax – Purpose – Rate – Exemptions Both manufacturers and farmers need records showing exempt purchases actually went into production, not personal use.
Motor Vehicles: No Casual-Sale Escape
Most casual sales between private individuals are exempt from Ohio sales tax, but motor vehicles are specifically excluded from that casual-sale exemption.14Ohio Department of Taxation. Sales Tax for Motor Vehicles, Watercraft, and Aircraft Buying a car from a dealership or from your neighbor, you owe sales tax either way. The Clerk of Courts collects it when you apply for the title, so there’s no sidestep.
A trade-in does reduce the taxable amount. When you trade in a vehicle toward a new one, the trade-in value cuts the price on which sales tax is calculated. The same works for watercraft traded for similar watercraft through a licensed dealer.14Ohio Department of Taxation. Sales Tax for Motor Vehicles, Watercraft, and Aircraft A boat bought out of state or in a casual sale is subject to Ohio use tax if you store or use it in Ohio and never paid Ohio sales tax on it.