Consumer Use Tax

CONSUMER’S USE TAX RATES

General 4.50%
Automotive 1.75%

Consumer’s Use Tax is imposed on the storage, use or consumption of tangible personal property in Huntsville at the same rate as Sales Tax.

Consumer’s Use Tax becomes due when the user and consumer of taxable goods does not pay tax to the seller, or pays tax to a seller that is not registered to collect City of Huntsville tax. Use tax is due on purchases made by Huntsville residents and businesses from another city or state which are not taxed. Generally, if you would be required to pay sales tax on goods purchased inside Huntsville, but you purchase them outside Huntsville and do not pay local sales tax, you are probably subject to use tax and must report and pay it to the city.

You are strongly encouraged to consult with your advisers or ask city representatives about how use tax applies to your activities.

BUSINESSES PROVIDING SERVICES

Many businesses primarily sell services, not merchandise to their customers, such as health care and dental professionals, attorneys, accountants, engineers, appraisers, software consultants, U.S. Government contractors, architects, and real estate agents. Although you may not be required to collect sales tax, it is very likely you are required to pay city use tax on materials, supplies, computer equipment, and other property used in your business, whether provided to your customers or not.