District of Columbia: Sales Tax Handbook

What purchases are exempt from the District of Columbia sales tax?

While the District of Columbia sales tax of 6% applies to most transactions, there are certain items that may be exempt from taxation. This page discusses various sales tax exemptions in District of Columbia.

Sales Tax Exemptions in District of Columbia

In District of Columbia, certain items may be exempt from the sales tax to all consumers, not just tax-exempt purchasers.

Certain groceries and some sorts of equipment intended for use in businesses is considered to be exempt in the District of Columbia.

Many states have special, lowered sales tax rates for certain types of staple goods - such as groceries, clothing and medicines. Restaurant meals may also have a special sales tax rate. Here are the special category rates for District of Columbia:

Clothing

  6%

Groceries

  EXEMPT

Prepared Food

  10%

Prescription Drugs

  EXEMPT

OTC Drugs

  EXEMPT

These categories may have some further qualifications before the special rate applies, such as a price cap on clothing items. Groceries are generally defined as "unprepared food", while pre-prepared food may be subject to the restaurant food tax rate.

Candy and soda may be included or excluded from any preferential tax rate depending on whether or not the state considers them to be a "grocery":

Candy IS considered a grocery in District of Columbia

Soda is NOT considered a grocery in District of Columbia

Are services, shipping, installation, etc taxable in District of Columbia?

The taxability of transactions involving services, shipping, and installation of tangible goods can be slightly complicated with various laws applying to slightly different situations. To learn more about how these transactions, and other more complicated situations, are subject to the District of Columbia sales tax see the District of Columbia sales taxability FAQ page.

Other tax-exempt items in District of Columbia

This table lists a number of additional categories of goods and services that are exempt from District of Columbia's sales tax. For a list that also shows taxable items, see the list of taxable and nontaxable items in District of Columbia.

* See notes in category taxability page for details