Use Tax

The use tax is a complementary tax to the state sales tax that is applied to items bought outside a state (or not taxed inside) but used, stored, or consumed in the state. Oklahoma taxes items subject to the use tax at the same rate as the sales tax. 

For several decades, states were limited in their ability to collect use taxes by a 1992 U.S. Supreme Court ruling, Quill v. North Dakota, that determined that retailers lacking a physical presence in a state, or “nexus,” could not be required to collect and remit taxes. The growth of online commerce led to significant revenue losses for states and local governments and various efforts to circumvent the Quill decision.  In 2018, the Supreme Court overturned the Quill precedent in South Dakota vs. Wayfair, Inc. In a 5-4 decision, it upheld a South Dakota law that required retailers to collect and remit tax on purchases even if the seller does not have a physical presence in the state, ruling that an economic presence should be the basis for taxing a sale. Oklahoma amended its laws to conform to the Wayfair decision: as of November 2019, a remote seller with $100,000 or more in taxable retail sales of tangible personal property during the preceding 12 calendar months is required to  collect and remit Oklahoma sales tax.

Oklahoma collected $638.5 million in state use tax revenues in FY 2024, which represented a 38.4 percent increase from the $461.3 million collected in FY 2021 and nearly triple the $203.2 million in use tax revenue collected in FY 2016.