The Wisconsin State Department of Revenue (DOR) is urging consumers and retailers to ensure the correct application of new Milwaukee sales taxes. Effective January 1, 2024, a new 2% city of Milwaukee sales and use tax, along with an increase in the Milwaukee County sales and use tax (from 0.5% to 0.9%), came into effect. The combined state, county, and city sales and use tax rate in the city of Milwaukee is now 7.9%, while the rest of Milwaukee County is at 5.9%.
Reports have emerged of retailers erroneously charging the new 2% sales and use tax on transactions occurring outside the city of Milwaukee, with instances noted in places like Glendale. The confusion arises from the distinction between postal delivery addresses and city boundaries, as 5-digit zip codes often cover multiple cities. Retailers bear the responsibility of accurately determining the applicable sales and use tax on each transaction.
To assist in determining the correct tax rate, the DOR recommends the use of tools such as the Wisconsin State and Local Sales Tax Rate Lookup Tool. This tool helps determine the tax rate based on specific street addresses or 9-digit zip codes. Retailers and software programmers can also utilize Wisconsin rate and boundary database files for programming purposes.
It is emphasized that a five-digit zip code alone is insufficient to ascertain if a transaction falls within the city of Milwaukee, as 5-digit zip codes often span multiple jurisdictions. Consumers are encouraged to notify the DOR of any instances where retailers charge an incorrect amount of tax. In such cases, consumers should request refunds directly from the retailer. If the overpaid tax amount is $50 or more, consumers have the option to request refunds directly from the department.