FAQs  |  Contact Us  |  Site Map    skip navigation
AZ.gov Arizona's Official Web Site
State of Arizona
Department of Revenue

Transaction Privilege Tax (TPT)

The Arizona transaction privilege tax (TPT) is commonly referred to as a sales tax; however, the tax is on the privilege of doing business in Arizona and is not a true sales tax. Although TPT is usually passed on to the consumer, it is actually a tax on the vendor. TPT is applied to entities engaged in certain business classifications, including retail sales.

Types of business activities subject to TPT include, but are not limited to: retail sales, restaurants/bars, hotel/motel (transient lodging), commercial leasing, advertising, amusements, personal property rentals, real property rentals, construction contracting, owner/builders, manufactured building, severance (mining, timbering), transportation, printing, publishing, utilities, communications, air/railroad, private cars/pipelines and use tax.

The Arizona Department of Revenue (ADOR) collects the tax for the counties and most cities, however, some of the cities license and collect their tax independently. Tax rates vary depending on the type of business activity, the city and the county.

If you are selling a product or engaging in a service subject to transaction privilege tax, you will most likely need to obtain the state transaction privilege tax (TPT) license from ADOR (commonly referred to as a sales tax, resale, wholesale, vendor or tax license) and a TPT or business/occupational license from the city or cities in which you are based and/or operate.

If you have questions about whether or not your business activity is subject to TPT, check with both ADOR and the licensing office(s) of the city or cities in which you will be based and/or operate.

Please note: There are some differences between the state and local authorities in the taxability of transactions. For instance, the state does not impose TPT on 1) renting, leasing, or licensing for use residential real property or 2) the sale of advertising. However, many cities do tax these activities.

For questions regarding TPT, please call 1-(844)-698-9176

• Additional Transaction Privilege Tax (TPT) Information