Taxable and Non-Taxable Services
The following discussions have been divided into several sections and are designed to assist you with your filing responsibilities with current information and rates. Although the list of examples of the services subject to sales tax are not intended to be all inclusive, it should be used as a guide to answer your questions regarding the application of sales tax to these services.
Services Subject to Sales and Use Tax
Examples of Taxable and Non-Taxable Services
Current Tax Rates
1. Sales and Use Tax
- Sales or charges for rooms, lodging, or accomodations furnished to transients will be taxed at the rate of 14.5 percent.
- Food and Beverage Tax: Sales of food or drink served or prepared for immediate consumption, or sold in or by restaurants, lunch counters, cafeterias, hotels, snack bars, caterers, boarding houses, carry-out shops and like places of business, or from carts and motor vehicles or any other form of vehicle, are subject to tax at the rate of 10 percent.
- Sale/Rental of Motor Vehicle/Utility Trailers: Sales or charges for the rental of motor vehicles and utility trailers will now be taxed at the rate of 10 percent.
2. Corporation and Unincorporated Business Franchise Tax
The Corporation and Unincorporated Business Franchise tax rate is 9.975 percent, including a surcharge of 2.5 percent.
General Information
Taxpayers who currently have a Sales and Use Tax liability less than $100 per month are placed on an annual filing basis. However, due to the new changes in the tax law, some annual filers may exceed the filing limitations and their filing status should be changed. In order to comply with the tax regulations, you should call the Office of Tax and Revenue, Customer Service Administration on (202) 727-4TAX to report any necessary changes.
Any business not currently registered with the Office of Tax and Revenue that is performing any services or related activities associated with the "Services Subject to Sales and Use Tax," should call Tax Forms office at (202) 727-6170 to obtain a registration application. The Tax Forms office is located at the Office of Tax and Revenue, 941 North Capitol Street, NE, First Floor, Customer Service Walk-In Center.
How to Obtain Additional Information
All questions related to the items discussed in this notice should be directed to the Office of Tax and Revenue, Audit division, at (202) 442-6631.
Written requests should be addressed to:
Government of the District of Columbia
Office of Tax and Revenue
Audit Division
P.O. Box 556
Washington, DC 20044
Tax Collection Charts
If you need tax collection charts, call (202) 727-4TAX (4829) to have charts mailed to you or visit the Office of Tax and Revenue, Customer Service Walk-In Center located at 941 North Capitol Street, NE, First Floor.
