Colorado Sales Tax Calculator

A low state rate with hundreds of local layers

Colorado's state sales tax is 2.90%, one of the lowest in the country. Local taxes do most of the work: counties, cities and special districts (such as transit and cultural districts) add an average of 4.99%, giving an average combined rate of 7.89% and a top rate of 12.00%. In Denver the combined rate is 9.15%.

What makes Colorado unusual is who collects the tax. The Colorado Department of Revenue collects state tax and many local taxes, but home-rule cities can write their own sales tax rules and collect the tax themselves. Denver, Aurora, Colorado Springs, Fort Collins and Lakewood are among the self-collecting home-rule cities the Department lists. For a business, that can mean filing with the state and separately with several cities.

State-collected vs self-collected local taxes

Colorado built the Sales and Use Tax System (SUTS) so businesses can file state and local returns in one place, and many self-collecting home-rule cities take part. SUTS cannot be used to file consumer use tax returns (DR 0251 or DR 0252) for the state or state-administered jurisdictions, though participating home-rule cities can accept use tax through it.

Groceries: exempt from state tax, sometimes taxed locally

Most food for home consumption is exempt from the 2.90% state tax. Cities and counties can decide whether to tax it. The Department of Revenue says that if a locality does exempt food, it has to use the same definition as the state, and that applies to home-rule cities too. Some home-rule cities do tax groceries, so a grocery receipt in one city may show tax while the same basket in the next town does not.

The state exemption follows the federal food stamp (SNAP) definition of food for home consumption, so a rough test is whether the item could be bought with SNAP benefits. Restaurant meals are taxed at the full combined rate.

Vehicles, delivery fees and use tax

When you buy a vehicle, the county clerk checks at titling and registration that all state and local sales and use taxes have been paid, and collects anything still owed before registering the vehicle. Any Colorado use tax due on a vehicle bought out of state is also paid to the county clerk at registration. That is why the tax bill for a car often arrives at the DMV counter rather than the dealership.

For other purchases where no Colorado tax was charged, such as goods from a small out-of-state seller, you owe consumer use tax. You report it to the state on the Consumer Use Tax Return (DR 0252), which can be filed through Revenue Online. Any city use tax owed to a self-collecting home-rule city is paid directly to that city.

Colorado also charges a retail delivery fee on delivered orders. It is a fee, not a sales tax, and is not subject to state or state-administered local sales tax, although some self-collecting home-rule cities may tax it.

Worked example: a purchase in Denver

A $800.00 bicycle bought in Denver is taxed at 9.15%: $73.20 of tax, $873.20 in total. Only $23.20 of that is state tax; the remaining $50.00 goes to the city and special districts. To reverse a Denver receipt, divide by 1.0915: a $200.00 total contains $16.77 of tax.

Tips for getting the Colorado rate right

• Use the full address, not the ZIP code. Special district boundaries often split ZIP codes.
• Check whether the city is home-rule and self-collecting; its rules may differ from the state's.
• Do not assume groceries are tax-free. The state exempts them, but some cities do not.
• Look at the tax lines on a receipt. Colorado receipts often itemize state, RTD and other district taxes separately.

Why Colorado's average hides big local differences

The statewide average of 7.89% is a population-weighted figure. Actual rates range from close to the 2.90% state rate in some rural areas to 12.00% in the highest-tax towns. Denver, at 9.15%, sits above the average.

On a $2,000.00 purchase, the gap between the state rate alone and the highest combined rate is $182.00. For big purchases delivered to your home, the delivery address decides which local taxes apply, so it pays to check it before ordering.

Colorado compared with neighbouring states

Colorado has the lowest state rate in the region, but its average combined rate is above Wyoming's 5.39% and Utah's 7.42%.

Worked example: the same grocery basket in two cities

Imagine a $150.00 grocery basket. The state never taxes it. In a city that exempts food, the receipt shows $0.00 of tax. In a city that taxes food at a local rate equal to the statewide local average of 4.99%, the same basket costs $7.49 more. Over a year of weekly shopping, that is about $389.22. Check your city's tax pages, or its receipts, to see whether it taxes groceries.