This blog was last updated on January 8, 2026
Arizona imposes a transaction privilege tax (TPT) on businesses in the state and is akin to sales tax administration. As such, it will often be referred to as “sales tax”. Arizona imposes a statewide TPT rate of 5.6%. The state does allow local jurisdictions to levy additional taxes.
What’s Taxable in Arizona?
Arizona TPT applies to the sale of tangible personal property and certain enumerated services. Sellers providing taxable goods and/or services are required to collect and remit TPT to the state.
Examples of taxable items and services include:
- Publishing
- Contracting
- Certain Digital Products
- Non-prescription drugs
- Clothing
TPT Nexus in Arizona
A seller is liable to collect and remit Arizona TPT if they meet the state’s nexus requirements. Nexus can be established through either physical or economic presence.
Arizona: Physical Nexus
Physical presence is created by having a business location, office, warehouse, vehicle, employee, or other representative operating in the state of Arizona.
Arizona: Economic Nexus
Arizona enforces economic nexus for remote sellers. If your business has:
- Over $100,000 in sales, during the previous calendar or current year;
you may be required to register for and collect Arizona TPT.
Learn more on the Arizona Department of Revenue Economic threshold page.
Arizona TPT Exemptions
Certain sales in Arizona are considered generally exempt from TPT requirements.
Exempt Products and Services
- Certain Food and food ingredients for home consumption
- Qualifying agricultural items
- Specific medical items
Entity or Use-Based Exemptions
Additionally, Arizona sales tax exemptions apply to certain entities from TPT with proper documentation, including:
- Qualifying hospitals
- Certain nonprofits
- Government
- Retailers selling for resale
How to Claim TPT Exemption in Arizona
To claim an exemption, an entity must provide an exemption certificate with the sale. The Treasury accepts TPT Form 5000 – Exemption Certificate General as the most used form. Additional guidance on acceptable exemption formats can be found here.
Arizona Filing and Remittance Requirements
There are multiple methods for filing and remitting sales and use tax in Arizona. This includes e-filing through AZ Taxes.gov as well as paper filing with Form TPT-EZ and Form TPT-2.
Frequently Asked Questions – Arizona State Sales Tax
Does Arizona have TPT holidays?
No, Arizona does not currently offer TPT holidays.
Are there any special point of sale fees in Arizona?
Point-of-sale fees are fixed amount or rate-based assessments levied on certain products or services at the time of sale and paid by the final consumer at retail. For example, Arizona imposes the following point of sale fees:
- E-911
- Waste Tire Fee
Does Arizona apply TPT to shipping charges?
Generally, Arizona does not apply TPT to shipping charges is seperately stated on an invoice.
For sourcing TPT, is Arizona origin or destination based?
Arizona is an origin based sourcing state.
How to register for an Arizona TPT License?
Arizona businesses or individuals selling tangible personal property or certain services to Arizona consumers may need register to collect TPT when meeting qualifying requirements. More information on Arizona business tax registration can be found here.
Additional Resources
For more information on U.S. sales tax compliance across all 50 states, check out our:
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