Use tax
A use tax is a type of excise tax levied in the United States. It is assessed upon otherwise “tax free” tangible personal property purchased by a resident of the assessing state for use, storage or consumption of goods in that state (not for resale), regardless of where the purchase took place. The use tax is typically assessed at the same rate as the sales tax that would have been owed (if any) had the same goods been purchased in the state of residence. Typical purchases that require payment of use tax include those done while traveling (for things carried or sent home), through mail order, or purchases via telephone or internet. For example, a resident of Massachusetts, which has a five percent “sales and use tax” on certain goods and services, purchases non-exempt goods or services in New Hampshire for use, storage or other consumption in Massachusetts.
