Delaware State Sales Tax – A Quick Guide for Businesses

State Spotlight Series DE

Delaware state lighthouse and horizon

State Sales Tax Rates:

The Delaware state sales tax is actually 0%. It is one of only five states in the union that does not require sales tax. Alaska is also included on that list. However, Delaware does have something really similar to sales tax, a gross receipts tax. This tax is on the gross revenues of a business, and like sales tax it varies depending on the business activity.

However, these taxes are much lower than a typical sales tax, only ranging from .0945% to .7468%.

The state has no official economic nexus laws but has stated it views internet sellers the same as storefront sellers. They are all expected to remit gross receipt taxes. You can find more about their expectations here. Also, you can call 302-752-3760 specifically for internet tax questions.

Remember just because there is no law for Delaware state sales tax, does not mean an eCommerce business will not have to remit money to the state.

Other Taxes

Additionally, Delaware does not levy any personal property taxes. These, and other tax breaks that are often much smaller than other states have led to calling Delaware a tax shelter.

The state does not have a corporate tax on interest or other investment income. Inheritance taxes are also not on the list of Delaware state taxes. After all of this, it’s hard to see how Delaware makes any money as a state, but they do, in a variety of ways.

Personal Income Tax and Other Revenue

Personal income taxes made Delaware the most money in 2013, coming in at over one billion dollars. Franchise taxes, abandoned property taxes, gambling revenue, and the above mentioned gross receipts tax all contribute to Delaware’s income.

Delaware State Flag

Weird Delaware Tax Laws & Facts

64% of all Fortune 500 Companies are located in Delaware. All because of their low corporate income tax of 8.7%, corporate-friendly laws, and a business-friendly state government.

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Please note: this blog is for informational purposes and should not to be considered, or used in place of, professional advice for your specific situation.

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