What is subject to sales tax in Nebraska?

Nebraska levies a sales tax on the majority of the goods and services bought and sold there. The state sales tax rate is 5.5%, and some towns and counties further tack on their own local sales taxes on top of that. The local sales tax rate varies depending on the region.

The majority of material products sold at retail, including as apparel, electronics, appliances, and furniture, are covered by the general sales tax law. Tangible personal property also includes real estate. There are a few exceptions to this rule, though. For instance, groceries and prescription prescriptions are not subject to sales tax in Nebraska.

Sales tax is imposed on a variety of services offered in Nebraska, including haircuts, auto repairs, and landscaping, in addition to tangible personal goods. However, several services, including those related to health and dentistry, law, and education, are excluded from sales tax.

For specific kinds of purchases, Nebraska also provides some exemptions and exclusions from the sales tax. For instance, the state exempts both purchases made by non-profit organizations and those made by the federal government or its agents from paying sales tax. Additionally, some goods and services, such as agricultural items utilized in production, may be excluded from sales tax.

A 5.5% state sales tax plus a 1.75% municipal sales tax are combined to create the city of Lincoln, Nebraska’s sales tax rate of 7.25%. As a result, Lincoln residents will pay a higher sales tax rate than residents in other sections of the state.

Last but not least, Nebraska does not impose taxes on Social Security benefits or many other forms of retirement income. This implies that seniors are exempt from state income tax on the income they receive through Social Security benefits, pensions, annuities, and other sources of retirement income.

In conclusion, with few exceptions and exclusions, Nebraska applies a sales tax to the majority of products and services purchased within the state. Depending on the region, different cities and counties may tack on their own municipal sales tax to the state rate. In addition to providing several exemptions and exclusions for specific kinds of transactions, Nebraska does not tax groceries or prescription medications. While Nebraska does not tax Social Security payments or many other forms of retirement income, the city of Lincoln has a higher sales tax rate than the rest of the state.