January 2021 sales tax rate changes

Updated January , 2021.

The start of each new year typically brings a slew of tax rate changes. Although very little seems typical now, this tradition is holding firm. On January 1, 2021, local sales tax rate changes will take effect in the states listed below. 

These aren’t the only changes related to sales tax taking effect on January 1, 2021.

In Illinois, for example, certain remote retailers will have to collect local sales tax in addition to state tax starting January 1, 2021. New requirements for marketplace facilitators and out-of-state wineries will also take effect.

Used car dealers in California must pay sales tax on car sales when they pay their vehicle registration fees (shortly after selling a car).

Cigarette and tobacco tax rates in Colorado will increase.

Sales tax licenses must be renewed annually in Arizona.

As of January 1, 2021, qualifying DTC alcohol shippers will be permitted to participate in the Streamlined Sales Tax program.

Businesses that make sales in the U.K. may be required to register for VAT in order to sell into Britain on and after January 1, 2021. Failure to register could result in shipments being stopped at the U.K. border, because of a little thing called Brexit.

2021 will bring numerous other sales tax changes beyond January 1. Find out what’s in store in our 2021 sales tax changes report.