Electricity and Telecommunications Sales and Use Tax

Sales of electricity are subject to the 3% State rate of sales tax, except for certain sales of electricity to commercial laundries and dry cleaners, which are subject to the 2.83% State rate of sales tax. Electricity sold to a manufacturer for use in connection with the operation of a manufacturing facility is exempt from sales and use tax. Electricity sold to a farmer to be used for any farming purposes other than preparing food, heating dwellings, and other household purposes is exempt from sales and use tax. Electricity sold to a farmer for preparing food, heating dwellings, and other household purposes remains subject to the 3% rate of sales tax. For additional information on sales of electricity, refer to Section 39 of the Sales and Use Tax Technical Bulletins.

Retail sales of telecommunications service and ancillary service are subject to an 7% combined general rate of tax. For additional information on telecommunications service, refer to Section 21 of the Sales and Use Tax Technical Bulletins.

The electricity and telecommunications sales and use tax is to be reported separately to the Department on the Utility and Liquor Sales and Use Tax Return, Form E-500E. Information about the filing frequency and due date requirements can be found in Filing Frequency and Due Dates.