Massachusetts Sales Tax: the 6.25% Rate, the $175 Clothing Rule and Due Dates

Those are the numbers. The clothing rule is the one that confuses buyers and catches out sellers, so it gets its own section below. Everything here comes from the Massachusetts Department of Revenue's guide to sales and use tax, read in October 2026.

What Massachusetts taxes and what it doesn't

Item	Treatment (as of October 2026)
Most tangible goods, including gas, electricity and steam	6.25%
Telecommunications services	6.25%
Cable TV and internet access	Exempt
Food for human consumption (not restaurant meals)	Exempt
Clothing costing $175 or less	Exempt
Clothing over $175	6.25% on the amount over $175
Separately stated shipping after the sale	Generally exempt
Local residential phone service	Exempt up to $30 per month

The $175 clothing rule

Here's the insight people miss. Massachusetts doesn't tax clothing on the first $175 of any single item. If an item costs more, tax is only due on the amount over $175. So a $200 coat isn't taxed on $200. It's taxed on $25. Get this wrong in your till and you overcharge every customer who buys a pricier item.

1. Check whether the item is clothing under the Department's definition.
2. Take the price of that one item.
3. Subtract $175.
4. Charge 6.25% on whatever is left, if anything.

Who has to register as a vendor

• You sell, rent or lease goods or telecommunications services in Massachusetts.
• You have representatives soliciting orders in the state.
• You deliver, repair or install goods in Massachusetts for customers there.
• You make remote sales to Massachusetts customers of more than $100,000 in a calendar year.
• You run a platform whose direct and facilitated Massachusetts sales exceed $100,000 in a calendar year.

Once you register, you get a Sales and Use Tax Registration Certificate, Form ST-1, for each business location. You must display it where customers can see it. Tax must be stated and charged separately on every invoice, bill or contract.

When Massachusetts returns are due

Sales or use tax collected per year	Filing frequency	Due date
$100 or less	Annual	30th day after the year ends
$101 up to $1,200	Quarterly	30th day after the quarter ends
$1,201 or more	Monthly	30th day after the month ends

Returns are filed in MassTaxConnect: Form ST-9 for goods and Form STS for services. Payment is due with the return. Bigger taxpayers, those with more than $150,000 in cumulative liability, also face advance payment rules brought in by the FY21 budget.

Penalties and interest

• Late payment: 1% of the unpaid tax per month or part month, up to 25%.
• Late filing: 1% of the balance due per month or part month, up to 25%.
• Interest: the federal short-term rate plus 4%, compounded daily.
• Negligence or a big understatement: 20% of the underpayment when it's more than 10% of the correct tax or $1,000, whichever is greater.
• Wrong format: up to $100 for each return, payment or data transfer you submit incorrectly, as of October 2026.

Use tax, credits and records

If you buy goods for use in Massachusetts and paid no sales tax, or less than 6.25%, you owe use tax. Unregistered businesses and individuals file Form ST-10 or ST-11 by April 15. Tax you paid to another state counts as a credit up to 6.25%, but only if that state has a reciprocal agreement with Massachusetts.

Keep records for at least 3 years from the date the return was filed or due, whichever is later. If you understate your tax by more than 25%, returns can be audited for up to 6 years. You also pay tax on a sale even if the customer hasn't paid you yet, and claim bad debts once a year on Form ST-BDR. If you buy stock to resell, my resale certificate guide explains how buyers avoid paying tax twice.

Goods sold with a service

Here's one that catches salons and garages. Items sold along with a service, like a bottle of shampoo from a salon or parts for a car repair, are taxable, and they must be itemised separately on the bill. The labour isn't taxed, but the product is, so don't bundle them into one line.

Tobacco and cigarette sellers

If you're a cigarette retailer, you must register for sales tax and also hold a Massachusetts cigarette retailer's licence, and you should check with your local Board of Health about a local permit. Tobacco product retailers prepay sales tax to their suppliers, then claim credit for it on their own sales tax return.

A small business energy exemption

Businesses with 5 or fewer employees and gross income under $1 million can buy energy for the business tax-free. They register in MassTaxConnect for a Small Business Energy Exemption certificate, give it to the supplier, and the certificate lasts two years.

My verdict

Massachusetts is a flat 6.25% state, and that's what makes it easier than most. There's no county maths to worry about. The work is in the exemptions. Build the $175 clothing rule into your system, keep shipping separate on invoices, and file by the 30th even in a quiet period. If you hire there too, check the Massachusetts minimum wage.

Frequently asked questions

What is the sales tax rate in Massachusetts?

The Massachusetts sales tax rate is 6.25% of the sales price or rental charge, and use tax is also 6.25%, as of October 2026.

Is clothing taxed in Massachusetts?

Clothing costing $175 or less per item is exempt. For items over $175, tax is only due on the amount over $175.

When are Massachusetts sales tax returns due?

On or before the 30th day after the period. Annual filers collect $100 or less a year, quarterly filers $101 up to $1,200, and monthly filers $1,201 or more.

Is food taxed in Massachusetts?

Food for human consumption is exempt, but meals sold by a restaurant are not part of that exemption.

What is the penalty for paying Massachusetts sales tax late?

1% of the unpaid tax per month or part month, up to a maximum of 25%, plus interest at the federal short-term rate plus 4%.