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1. How do I obtain a Transaction Privilege (Sales) Tax license?

The Town of Prescott Valley participates as a “Program City” with the Arizona Department of Revenue. You may apply for a license for the State and Town on www.aztaxes.gov, "License a Business"; or by utilizing the Arizona Joint Tax Application (JT-1) available at www.azdor.gov.

2. What is the current transaction privilege tax (TPT) rate?

The current TPT tax rate for most businesses in Prescott Valley is 2.83%. The rate for the State and Yavapai County is 6.35%. The total figure is 9.18% for most business classes.

3. What are the other tax rates?

There is an additional tax on hotels/motels of 2.83% in Prescott Valley.

4. How do I pay Prescott Valley TPT?

The Arizona Department of Revenue collects Prescott Valley tax along with the State and Yavapai County. Report and pay your Prescott Valley tax online at www.aztaxes.gov.

5. What are the region codes for reporting tax for the Town of Prescott Valley?

The region code for Prescott Valley is “PL” and "YAV" denotes Yavapai County. The business classes and codes are viewable by clicking on the link on this Transaction Privilege Tax webpage.

6. How do I calculate my taxes due?

Taxes are calculated by stating the gross receipts for the reporting period on the tax return, entering the itemized deductions, then multiplying the resulting net taxable amount by the appropriate tax rate (6.35% for the State/Yavapai County and 2.83% for the Town).

7. What if I don’t collect the tax from my customers?

It is the responsibility of the business to remit transaction privilege tax. Whether you collect it from your customers or not, the tax liability for all taxable business conducted in the Town of Prescott Valley must be remitted.

8. What are the tax factors?

The retail tax factor for 9.18% tax is .08408133.
The construction tax factor for 9.18% is .05630998.

9. How do I get answers to my specific questions?

The Town endeavors to provide the best customer service possible. To that end, our staff will provide answers to your tax questions. However, please be advised that we are not bound by oral advice given by Town staff members. If you have questions, please contact our TPT department at 928-759-3132 or email salestax@prescottvalley-az.gov.

10. Are sales to the Town of Prescott Valley taxable?

Yes. All sales (except sales for resale) that you make to the Town are taxed in the same manner as other taxable sales, which means that the Town will be subject to the regular 2.83% Town tax in addition to the State and Yavapai County tax. This also applies to construction.

11. Does the Town of Prescott Valley tax the rental of real property?

The Town has a 0% tax rate on the rental of residential and commercial real property. However, the rental of personal property (such as restaurant equipment or automobiles) is taxed at 2.83%.

12. Is food taxable in Prescott Valley?

Yes. Food sold in the Town is subject to the Town tax of 2.83%. The State of Arizona and Yavapai County do not tax food unless it is prepared and sold for consumption on or off the premise (i.e. restaurants, bars).

13. Are service, installation labor, and shipping taxable?

For retail transactions, these types of charges are not considered taxable if the charges are separately stated to the customer and the seller separately maintains records summarizing such charges.

14. Are Internet sales taxable?

Items sold by Prescott Valley based businesses via the Internet to Arizona residents are taxable at the State rate and Prescott Valley rate and must be reported as such.

15. What is Use Tax?

Use Tax is levied on retail purchases from out-of-state vendors, and is generally noted as “sales” tax on the vendor’s invoice. It was enacted with the specific intent to prevent unfair competition from out-of-state vendors. If the out-of-state vendor does not specifically charge the use (or “sales”) tax, then the Arizona purchaser is responsible for remitting the tax. The Arizona rate for Use Tax is 6.6% and the Town of Prescott Valley rate is 2.83%. 

Use tax is also levied on businesses that purchase items for resale and subsequently use those items internally instead of selling them, i.e. "Use Tax From Inventory."