Single Local Use Tax Rate in Texas

by Teresa Farnsworth May 24, 2021

Remote sellers are out-of-state sellers whose only activity in Texas is the remote solicitation of sales. Remote sellers have Texas tax collection and reporting obligations if they have economic nexus in this state. If you have a physical presence in this state (i.e., business location, salespersons, representatives, etc.), you are not a remote seller.

The single local use tax rate is an alternative local tax rate that remote sellers can use instead of collecting and remitting the total local tax in effect at the destination address. The current single local use tax rate is 1.75 percent, and the rate is published in the Texas Register by Jan. 1 of each year.

Remote sellers can choose to collect the alternate single local use tax rate. Businesses located in Texas are not remote sellers and cannot use the single local use tax rate for sales. Additionally, the single local use tax rate is not available to any marketplace provider collecting taxes on behalf of marketplace sellers.

If you are a remote seller that chooses to collect the single local use tax, you must notify the Comptroller’s office in writing of your election using Form 01-799, Remote Seller's Intent to Elect or Revoke Use of Single Local Use Tax Rate (PDF) by email or mail. The effective date must be on the beginning date of a reporting period.

Teresa Farnsworth
Teresa Farnsworth

Teresa Farnsworth is the VP / Account Manager at Zip2Tax. She works closely with her clients to make sure they have just what they need to collect the right amount of sales or use tax in the U.S. and Canada. Questions? Chat with Teresa on the Web site, the Subscriber User Portal, or call her direct line; 866-492-8494.

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