What is the Sales Tax in Milwaukee, WI?

Sales tax in Milwaukee is a multi-layered system, combining levies from the state, county, and the city itself. This structure requires an understanding of each component to determine the total rate applied to transactions. Navigating these different tax layers is a routine part of commerce for businesses and consumers within the city.

Milwaukee Sales Tax Rate Breakdown

The total combined sales tax rate for transactions within the City of Milwaukee is 7.9%. This rate is an aggregation of three separate jurisdictional taxes, each applied to the same taxable sales.

The first component is the statewide sales and use tax, which is set at 5.0%. On top of the state tax, Milwaukee County imposes its own sales and use tax. As of January 1, 2024, the Milwaukee County tax rate increased to 0.9%. This county-level tax applies to all sales within the county’s borders, including those inside the City of Milwaukee.

The final piece is a city-specific sales and use tax. The City of Milwaukee introduced a 2.0% tax, also effective January 1, 2024. This recent addition is layered on top of the state and county rates, bringing the cumulative sales tax to the 7.9% total for sales occurring within the city’s official boundaries.

Taxable Goods and Services

The foundation of sales tax in Wisconsin, and therefore Milwaukee, is the taxation of tangible personal property. This broad category includes most physical items one can purchase, such as clothing, furniture, electronics, and motor vehicles. The tax also extends to certain services, including telecommunications services, lodging, and admissions to amusement or recreational events like concerts and sporting events.

When dining at a restaurant, the prepared food and beverages served are taxable. The tax is calculated on the sales price and must be collected by the seller at the time of the transaction.

There are several significant exemptions provided under state law that directly impact consumers. These exemptions are applied statewide and are not altered by the local Milwaukee or Milwaukee County taxes. Items that are not taxed include:

• Most unprepared food items intended for home consumption, often referred to as groceries
• Prescription drugs and certain medical devices
• Newspapers
• Fuel used for residential purposes

Business Registration for Sales Tax Collection

Any business making taxable sales in Wisconsin must first obtain a seller’s permit from the Wisconsin Department of Revenue. This permit is the legal authorization for a business to collect sales tax from its customers. Operating without this permit while conducting taxable transactions can lead to penalties and legal complications.

To complete the application for a seller’s permit, a business must provide specific identifying information. This includes:

• The legal name of the business, any trade name or “doing business as” (DBA) name
• The federal employer identification number (EIN), if applicable
• The business’s physical address
• Its North American Industry Classification System (NAICS) code, which identifies the business’s primary activity

The application is available online through the Wisconsin Department of Revenue’s website. Registering for a seller’s permit in Wisconsin requires a one-time $20 Business Tax Registration fee. Once the permit is issued and taxable sales begin, the business must start collecting and remitting sales tax.

Filing and Remitting Sales Tax

After registering and collecting sales tax, businesses must file regular returns and remit the collected funds to the state. The Wisconsin Department of Revenue assigns a filing frequency to each business, which can be monthly, quarterly, or annually. This assignment is based on the amount of sales tax the business is expected to collect.

Due dates for filing and payment are standardized. The due date for monthly filers varies; standard returns are due on the last day of the month following the reporting period, while high-volume businesses may have an earlier due date of the 20th. Quarterly returns are due on the last day of the month following the end of the quarter. Annual filers must submit their return and payment by January 31 of the following year.

The primary method for managing these obligations is through the state’s “My Tax Account” online portal. Using the online portal is the required method for most businesses.