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Vermont: Local Option Tax Update


 Vermont allows local option taxes.

Updated 8.23.2017

Municipalities in Vermont are permitted to levy several different local option taxes in addition to the state business taxes. Local option taxes are collected on the taxable (net) sale and are destination-based, meaning tax is based on the location where the buyer takes possession of the item or where the item is delivered.

A local option tax of 1% may be added to the following state taxes:

  • Alcoholic beverages tax (10%)
  • Meals tax (9%)
  • Rooms tax (9%)
  • Sales tax (6%)

Local option taxes do not apply to the following:

  • Motor vehicle purchase and use tax
  • Use tax

Except in the case of Burlington and Rutland, local option taxes are collected by the vendor and remitted to the Vermont Department of Taxes. Burlington and Rutland administer and collect their own local taxes, which are imposed on entertainment, lodging and meals.

Municipalities with local option sales tax:

  • Brandon
  • Burlington
  • Colchester
  • Dover
  • Killington
  • Manchester
  • Middlebury
  • Rutland Town
  • St. Albans Town
  • South Burlington
  • Stratton
  • Williston
  • Wilmington
  • Winhall

Municipalities with local option alcoholic beverages, meals and rooms taxes:

  • Brandon
  • Brattleboro
  • Colchester
  • Dover
  • Hartford (as of Oct. 1, 2017)
  • Killington
  • Manchester
  • Middlebury
  • Montpelier
  • Montpelier
  • Rutland Town
  • St. Albans Town
  • South Burlington
  • Stowe
  • Stratton
  • Willison
  • Wilmington
  • Winhall
  • Woodstock

Additional information, including examples of how to apply state and local option taxes, is available on the Vermont Department of Taxes website.

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.