use tax
The tax you owe on something bought untaxed elsewhere.
A complement to sales tax on goods acquired untaxed and consumed within the state.
What that means in practice
Say you buy something out of state and pay no sales tax on it. If you bring it home to use, your own state can still claim that tax. Individuals rarely pay it. States rarely chase it. But the obligation is real, and businesses do get audited on it.
Use tax exists to prevent erosion of the sales tax base through out-of-state purchasing, and applies at the same rate as the sales tax it complements. ⚠️ Individual compliance is minimal and enforcement is concentrated on business purchasers, but the liability is not discretionary. Remote-seller collection obligations following economic nexus rules have substantially reduced the residual base.
Questions people ask
Is this the same everywhere in the country?
There is no national version. States decide, local governments frequently add to it, and use tax therefore depends on the address rather than the country.
Is this one of those terms that needs three other terms to explain it?
No — this one holds up by itself. That is unusual enough in tax vocabulary to be worth saying.
Is this the standard name for it?
Yes. use tax is settled usage. Several terms nearby go by two or three names each.
How is this determined across jurisdictions?
No federal general sales tax exists; consumption taxes are levied by states and, where authorized, by counties, municipalities and special districts. Rates are sourced to the point of sale, so applicable liability varies within a state as well as between states.
Does this term resolve independently?
This term resolves largely independently of other defined terms, with limited cross-references. It is therefore usable as an entry point; more heavily cross-referenced provisions generally require it rather than the reverse.
Is this designation the settled one?
This designation is the settled term of art with limited alternative usage, so it maps reliably to statutory and agency references. Terms with multiple colloquial designations require more care when searching source material.