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What Does Sales Tax And Use Tax Mean In Massachusetts?

Starting August 1, 2009, the MA sales tax percentage is 6.25 percent of the sales price or rental charge of tangible personal property or certain telecommunications services sold or rented in Massachusetts.

The sales tax typically is paid to the vendor as an addition to the purchase price. The consumer pays the sales tax to the vendor at the point of purchase; the vendor then remits the tax to the state. For car and trailer sales, however, the sales tax is paid directly to the Commonwealth by the buyer.

Since August 1, 2009, the Massachusetts use tax is 6.25 percent of the sales price or rental charge on tangible personal property 1 (including mail order merchandise or products ordered over the Internet) or particular telecommunications services on which no sales tax, or a sales tax rate less than the 6.25 percent Massachusetts rate, was paid and which is to be used, stored or consumed in the state. The use tax, unlike the sales tax, commonly is paid specifically to the state by the consumer.

Case in point: You buy household furniture for your MA organization or house from an out-of-state firm and pay no MA or other state sales tax. You are required to pay the 6.25 percent MA use tax. The use tax applies simply because the items were not subject to a sales tax in the other state and because it is for use in the state.

Concrete private property includes electronically transferred software.Telecommunications services include things like telephone and other transmissions of data (such as beeper services, cellular telephone services and telegram services). Cable television and Internet access are exempt from the sales tax. Generally, the tax on the sale or use of telecommunications services is a tax on the transmission of messages or information by various electronic means, but not on the sale or use of data itself.

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