Sales Tax in Colorado, Arizona in 2025

We'll walk you through how the sales tax rate is determined for Colorado and address some common questions you may have. We'll also cover how to collect, audit, and remit sales tax in Colorado.

Plus, we’ll share the best solution that will ensure you are always compliant across the entire sales tax lifecycle.

Disclaimer: Our sales tax data is updated on a quarterly basis.

Colorado Sales Tax Rate 2025

Colorado is located in Mohave County in Arizona, United States, and has a sales tax rate of 8.60%. This includes local and state sales tax rates.

Here is the breakdown of the Colorado's sales tax:

Tax Jurisdiction	Sales Tax Rate
State Tax	5.60%
City Tax	3.00%
Combined Rate	8.60%

This rate applies to the following zip codes in Colorado:

86021, 84784, 84737

How Does the Colorado Sales Tax Compare to the Rest of Arizona?

Colorado’s 8.60% sales tax rate is 2.50% lower than the highest sales tax rate in Arizona, which stands at 11.10% in cities like South Tucson.

It is 1.25% higher than the lowest sales tax rate in Arizona, which stands at 7.35% in cities like Camp Verde.

To give you a better idea, here’s a comparison of Colorado sales tax rates with a few other cities in Arizona:

City	Sales Tax Rates
Camp Verde	7.35%
Pinetop-Lakeside	7.93%
Tempe	8.10%
Colorado	8.60%
Taylor	9.43%
Hayden	9.60%-9.70%
Guadalupe	10.30%
South Tucson	11.10%

You can also compare the sales tax rate of Colorado against the Arizona cities closest in population size:

• Willcox's sales tax rate is 8.60%
• Pima's sales tax rate is 8.60%

What Creates Sales Tax Nexus in Colorado?

Colorado has the sales tax nexus rules as Arizona. 

Read More: Check out this detailed guide on Sales Tax in Arizona.

You have sales tax nexus in Colorado if you meet one of the following conditions:

• Physical nexus: Businesses that own or lease real or personal property in Arizona, such as offices, inventories, and more.
• Employees: Businesses with independent contractors, employees, or other non-employee representatives who conduct business activities on behalf of the company in the state.
• Economic nexus: Marketplace facilitators and remote sellers who make more than $100,000 in the state.
• Delivery of taxable goods and services: Businesses who deliver merchandise into Arizona on vehicles owned or leased by the taxpayer. 

Learn more about sales tax nexus and when you’re required to collect sales tax.

What Products Are Exempt from Colorado Sales Tax?

Colorado doesn't have any special exemptions and follows the same sales tax rules as Arizona.

The items exempt from sales tax in Colorado are:

• Mining and metallurgical supplies.
• Natural gas or liquefied petroleum gas used to propel a motor vehicle.
• Drugs and medical oxygen, including delivery hose, mask or tent, regulator and tank, if prescribed by a member of the medical, dental, or veterinarian profession.
• Livestock and poultry sold to persons engaging in farming, ranching, or producing livestock or poultry.
• Textbooks, sold by a bookstore or required by any state university or community college.

Who Needs a Sales Permit in Colorado?

You need a sales permit if you are a retailer located in Colorado or if you have a sales tax nexus.

You can create an account and register online via the Arizona Department of Revenue website. 

How to Collect Sales Tax in Colorado

Colorado uses destination-based sales tax sourcing for businesses located outside the state. This means that if you sell to a customer in Colorado from another state, you must apply the sales tax rate based on the buyer’s shipping address.

Meanwhile, if your business is located in Colorado, the sales tax applies origin-based sourcing rules. This means that to sell taxable goods to Colorado residents from within the state, you must collect the sales tax rate of your business’s address.

Learn more about origin-based and destination-based sales tax sourcing here.

How to File and Pay Sales Tax in Colorado

You can file Colorado sales tax returns using the following methods:

• File online: File electronically through the Arizona Department of Revenue.
• File by mail: Mail Form TPT-EZ for businesses in a single location and TPT-2 for businesses in multiple locations to:
  Arizona Department of Revenue
  P.O. Box 29010
  Phoenix, AZ 85038
• Let Zamp handle your Arizona sales tax filing and remittance so you won’t ever have to deal with a sales tax return!