Four Quarter Cents
Grand Prairie's sales tax is 8.25 percent throughout the city, even though the city spans four counties. The state receives 6.25 percent and the city's general fund 1 percent. The other 1 percent is split into four voter-approved quarter cents: one for the Crime Control and Prevention District, one for EpicCentral and Epic Waters, one for park improvements and one for street maintenance. Grand Prairie is not a DART member. BOMCAS handles sales tax for Grand Prairie businesses remotely.
General sales tax permits and taxable services are explained on the Texas sales and use tax page, while this page covers Grand Prairie's plants, contracts and restaurants.
Manufacturing Exemptions
Materials that become part of a product made for sale, and machinery and equipment used directly in manufacturing, are exempt with an exemption certificate. Plants in Grand Prairie can therefore buy resin, components and production equipment without tax. Maintenance supplies, office equipment, warehouse forklifts and tools used for repairs are generally taxable, and auditors often focus on these items.
Federal Contracts
Sales to the federal government are exempt from Texas sales tax. A contractor that buys items and resells them to the government under a contract that passes title to the government can generally buy them for resale. Supplies and equipment the contractor uses itself to perform the contract are taxable to the contractor. Defence suppliers should separate these two kinds of purchases in their purchasing system.
Software and Data Services
Engineering and manufacturing firms buy software, cloud services and data processing. Texas taxes data processing services on 80 percent of the charge, with 20 percent exempt. Out-of-state vendors that do not collect Texas tax leave the buyer to accrue use tax on its next return.
Warehouses and Distribution
Distribution centres buy racking, packaging, pallets and forklifts, which are taxable when used by the warehouse itself. Packaging that goes to the customer with the product can be bought for resale. Goods shipped from Grand Prairie to Texas customers carry tax based on the seller's location, and shipments out of state are generally exempt with proof of shipment.
Restaurants and Asian Markets
Restaurants collect tax on prepared food, including to-go orders. Bakery items such as bread, buns and pastries are exempt when sold without plates or utensils. Grocery food is exempt, but soft drinks, candy and household items in an Asian or Hispanic grocery are taxable, so registers should be coded by category. A mandatory gratuity of 20 percent or less is not taxable if it is clearly labelled and goes to the staff.
Contractors
Remodelling and repairs to homes are done under lump-sum or separated contracts with different results; repairs and remodelling of commercial buildings, including warehouses and plants, are taxable services. Contractors working across Grand Prairie's industrial parks need to classify each job correctly.
Hotel Tax
Hotel stays in Grand Prairie carry 7 percent city hotel tax and 6 percent state hotel tax, 13 percent in total. Hotels near Lone Star Park, Epic Waters and the interstates file the city tax with Grand Prairie and the state tax with the Comptroller. Short-term rental hosts owe both unless the platform collects them.
Our Help
- Permits and returns.
- Exemption and resale certificates.
- Government contract purchases.
- Use tax accruals.
- Register setup for food sales.
- Audits and refund claims.
Grand Prairie Sales and Use Tax Questions
Why is Grand Prairie's rate the same in all four counties?
The city's 2 percent local tax applies across the city, with no separate county or transit tax.
Can a defence supplier buy materials tax free?
Materials resold to the government under the contract generally can be; supplies used by the supplier itself are taxable.
Are tips on restaurant bills taxable?
Voluntary tips are not. A mandatory gratuity of 20 percent or less, clearly labelled and paid to staff, is not taxable.
What is the sales tax rate in Grand Prairie?
8.25 percent.
Talk to BOMCAS About Sales and Use Tax in Grand Prairie
Sales tax must match the books and the business return. Staff go through payroll, audit findings are handled under back taxes, new plant equipment is a planning matter, owners file personal returns and imported parts raise cross-border points. The rules that apply across Texas are explained on our state pages for business returns, individual returns, bookkeeping, payroll, tax planning, late filing and international tax, reachable from the Texas overview.
Running a shop that supplies the big plants, a fleet off Interstate 20 or a restaurant near Asian Times Square? Send BOMCAS a short note and we will tell you what we would check first and what we need to quote. Go to the contact page or use the form below, call 780-667-5250 or write to info@bomcas.ca. Every Grand Prairie service is linked from the Grand Prairie overview. This page offers general information and is not advice on your own situation.