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Local Option Tax

Local option tax is a way for municipalities in Vermont to raise additional revenue. A municipality may vote to levy the following 1% local option taxes in addition to state business taxes. Please note: Local option tax does not apply to the sale or rental of motor vehicles which are subject to the motor vehicle purchase and use tax.

Local Option Sales Tax: 6% sales tax + 1% = 7% total tax

Local Option Meals Tax: 9% meals tax + 1% = 10% total tax

Local Option Alcoholic Beverage Tax: 10% alcohol tax + 1% = 11% total tax

Local Option Rooms Tax: 9% rooms tax + 1% = 10% total tax

Local Option Tax Finder

Search for a specific address or town to determine if a Local Option Tax is levied. Open the local option tax finder in new window.

Municipalities that have a 1% Local Option Sales Tax

Municipality Effective Date
Barre City Oct. 2022 (Effective beginning 10/1/2022)
Brandon Oct. 2016
Brattleboro July 2019
Burlington July 2006
City of Essex Junction Oct. 2022 (Effective beginning 10/1/2022)
Colchester Oct. 2015
Dover July 2007
Killington Oct. 2008 (Rescinded as of 7/1/2018)
Manchester April 1999
Middlebury Oct. 2008
Montgomery Oct. 2022 (Effective beginning 10/1/2022)
Rutland Town April 2009
St. Albans City Oct. 2020
St. Albans Town July 2014
South Burlington Oct. 2007
Stratton July 2004
Williston July 2003
Wilmington July 2012
Winhall July 2010
Winooski July 2019

Municipalities that have a 1% Local Option Meals and Rooms Tax and Alcoholic Beverage Tax

Municipality Effective Date
Brandon Oct. 2016
Brattleboro April 2007
Barre City Oct. 2018
City of Essex Junction Oct. 2022 (Effective beginning 10/1/2022)
Colchester Oct. 2015
Dover July 2007
Hartford1 Oct. 2017
Killington Oct. 2008
Manchester April 2008
Middlebury Oct. 2008
Montgomery Oct. 2022 (Effective beginning 10/1/2022)
Montpelier Oct. 2016
Rutland Town April 2009
St. Albans City Oct. 2020
St. Albans Town July 2014
South Burlington Oct. 2007
Stowe July 2006
Stratton July 2004
Williston July 2003
Wilmington July 2012
Winhall July 2010
Winooski July 2019
Woodstock July 2015

1The Town of Hartford includes Quechee, White River Junction, West Hartford, and Wilder

Municipalities that have a 1% Local Option Rooms Tax

Municipality Effective Date
Elmore July 2021

Please note: The City of Burlington and the City of Rutland administer and collect their own local meals, entertainment, lodging, or alcoholic beverage taxes. If you have a business in Burlington or Rutland City, please contact the appropriate city for information on how to pay and remit the tax.

Contact the City of Burlington: (802) 865-7000

Contact the City of Rutland: (802) 773-1800

How to Calculate and Remit Local Option Tax

Beginning in November of this year, the Vermont Department of Taxes will only accept meals and rooms tax returns from businesses who collect and report Local Option Meals and Rooms Tax if they are filed electronically. The requirement to file electronically for Local Option Meals and Rooms taxpayers is effective for the period beginning October 1, 2022. Returns for that period are due on November 28, 2022.

Local option tax is calculated as 1% of the taxable (net) sales for each town. A transaction is subject to local option tax if it is subject to the Vermont sales, meals, rooms, or alcoholic beverage tax. Local option tax is “destination-based.” In other words, the tax is collected based on the location where the buyer takes possession of the item or where it is delivered.

All vendors, including out of state vendors, authorized to collect taxes in Vermont are required to collect and remit to the Vermont Department of Taxes all applicable local option taxes for sales that occur in participating municipalities. No additional registration with the Department is necessary.

Although local option tax is levied by the municipality, the Department collects and administers the tax.  Vendors who collect this tax file and remit it to the Department along with their state taxes, online or by paper form.

Be sure to charge, collect, and remit local option tax for applicable purchases in the municipality where the buyer is consuming or taking possession of the item or where the item is being delivered.