In Utah a tax is levied on the purchaser for the amount paid or charged for:

• retail sales of tangible personal property
• amounts paid to common carriers or telephone or telegraph corporations
• gas, electricity, heat, coal, fuel oil, or other fuels sold or furnished for commercial or residential use
• meals
• admissions or user fees for entertainment, recreation, cultural, or athletic activities
• services for repairs, renovations, or installation of tangible personal property
• cleaning or washing of tangible personal property
• hotel or trailer court accommodations and services for less than 30 consecutive days
• laundry and dry cleaning services
• leases and rentals of tangible personal property
• tangible personal property stored, used or consumed in Utah
• prepaid telephone calling cards

Sales and use tax rate. The general Utah state sales and use tax rate for 2009 forward is 4.7 percent; it was 4.65 percent in 2008; it was 4.75 percent through 2007. (In addition, make sure you contact your local governments in Utah because they are allowed to assess a local sales and use tax.)

The tax rate on the residential use of utility services is 2 percent.

Starting January 1, 2008, the state portion of sales and use tax on food and food ingredients was reduced from 2.75 percent to 1.75 percent. (The tax on food and food ingredients has been reduced to 3.0% statewide. This includes the state rate of 1.75%, local option rate of 1.0% and county option rate of 0.25%.) This category includes substances in liquid, concentrated, solid, dried, or dehydrated form that are sold for ingestion or chewing by humans and consumed for the substance's taste or nutritional value. Tobacco products, alcoholic beverages, and prepared foods are excluded from the reduced rate.

Tax-exempt items. Utah has many specific items that are exempt from sales tax — for example, certain prescription medications are exempt from Utah sales tax. You'll want to check and see if you are exempt from the sales tax.

Responsibility for paying sales tax. In Utah the purchaser is liable for paying the sales tax, but vendors are responsible for collecting the tax and remitting it to the state.

Use tax. The use tax is an excise tax on the storage, use, or other consumption of tangible personal property in Utah on which no sales tax was paid. The use tax is a complementary tax that applies when the Utah sales tax does not.

Responsibility for collecting use tax. The person storing, using, or consuming tangible personal property within the state is liable for the use tax.

Obtaining tax permits in Utah. In Utah you need a separate license for each place of business, but even if you operate more than one place of business you need only complete one application. You must file the application with the Utah Tax Commission.

Leases. In Utah if the sale of the tangible personal property is subject to sales tax, the rental or lease of the same property is also a taxable sale. The lessor must compute sales or use tax on amounts received or charged according to the rental or lease agreement.

The following discussions address additional sales and use tax issues that many small business owners face:

• sales and use tax obligations of a purchaser
• sales and use tax obligations of a seller