State sales tax laws generally are complex, and New York's are more complicated than most because different parts of the state collect taxes at different rates. New York City also taxes some services that are exempt in other areas of the state.
Sales Tax Rates
The state sales tax rates for New York vary depending on where you are located. The state base sales tax rate is 4 percent, but this increases depending on the municipality or county you live in. For example, in New York City, the sales tax rate is 8.875 percent, while in Glen Falls the rate is 7 percent. If your municipality or county does not impose a higher rate, the state tax rate of 4 percent applies.
Tangible Property Sales
Most sales of tangible personal property are taxed at the local rate for sales tax. This includes furniture, motor vehicles and certain clothing and footwear, as well as many other items. In addition, sales tax must be paid on candy, soda, beer and cigarettes. Machinery and equipment, tools, computers and supplies are subject to the applicable New York sales tax, as well as motor fuels, animals used as pets, and trees, shrubs and building supplies. Restaurant food also is subject to New York sales tax.
Tangible personal property refers to any kind of physical personal property that is perceptible to human senses, meaning you can see or touch it.
Some services also are subject to the New York sales tax. Examples include telecommunications services, including cellular phone service, utility services, and admission charges to places of amusement. Service fees charged for maintaining, installing or servicing tangible personal property also are taxable, as well as maintenance and repair of real property. Protective, security and detective services are included, as well as hotel occupancy fees.
New York City Sales Tax
In addition to the higher rates New York City collects for sales tax, additional services are taxable within the metropolitan area. These services include beautician or barber services, which also encompass tanning, manicure and pedicure services. Massage, weight loss and gymnasium services also are taxable in New York City, as are certain credit reporting services.
Raw materials, parts, and other goods related to manufacturing other tangible property for sale are not taxable in New York. In addition, fuel and utilities used in this process are exempt, as well as the cost to ship these goods to market. Also not taxable is most food for home consumption, medical services and the sales or rental of real estate. Funeral services, and sales of tangible property by a funeral home are exempt from New York sales tax. You do not pay tax on medical devices and pharmaceuticals, water delivered through pipes, or any product used in farming or commercial horse boarding.
Online sales of tangible personal property are not taxed in New York unless the business selling the product has a physical business location in New York. As an example, Amazon collects sales taxes on sales to New York residents who have the product shipped to a New York address.
Different areas of the state of New York, served by public transportation, collect additional sales taxes on all eligible goods to help fund the cost of the Metropolitan Commuter Transportation District. In most cases, this tax is an additional 0.375 percent. Car rentals companies collect an 11 percent tax on their fees within the MCTD, with other rental companies collecting 6 percent.
Craig Woodman began writing professionally in 2007. Woodman's articles have been published in "Professional Distributor" magazine and in various online publications. He has written extensively on automotive issues, business, personal finance and recreational vehicles. Woodman is pursuing a Bachelor of Science in finance through online education.