Sales Tax Calculator
Calculate sales tax and total cost.
Sales Tax Calculator
Calculate sales tax and total cost.
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Understanding Sales Tax
Sales tax is a consumption tax imposed by governments on the sale of goods and services. In the United States, sales tax rates vary by state, county, and city, ranging from 0% to over 10%. Understanding how sales tax affects your purchases helps you budget accurately and avoid surprises at checkout.
This calculator works in two modes: adding sales tax to a pre-tax price to find the total amount you'll pay, or removing sales tax from a total price to find the original pre-tax amount. Both calculations are essential for different scenarios - budgeting purchases or understanding what portion of your payment is tax.
Sales tax is typically calculated as a percentage of the purchase price and added at the point of sale. Unlike value-added tax (VAT) in many countries, US sales tax is not included in displayed prices - it's added when you check out, making this calculator especially useful for determining final costs.
How to Calculate Sales Tax
There are two primary sales tax calculations: adding tax to a price and removing tax from a total. Each serves different purposes in budgeting and financial planning.
Adding Sales Tax Formula:
Tax Amount = Price × (Tax Rate ÷ 100)
Total Price = Price + Tax Amount
Removing Sales Tax Formula:
Pre-Tax Price = Total Price ÷ (1 + Tax Rate ÷ 100)
Example:
Item Price: $100 | Sales Tax Rate: 7%
Tax Amount = $100 × 0.07 = $7.00
Total Price = $100 + $7 = $107.00
You pay $107.00 at checkout
Sales Tax Rates by State
US sales tax rates vary significantly by location. Here are the base state rates for major states (local rates may add 1-5% more):
Important: Five states have no state sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. However, some localities in these states may impose their own sales taxes.
Tax Exemptions & Special Cases
Groceries
Many states exempt groceries (unprepared food) from sales tax, though prepared foods and restaurant meals are typically taxed at full rate.
Prescription Drugs
Most states exempt prescription medications from sales tax, though over-the-counter drugs are usually taxed normally.
Clothing
Some states like Pennsylvania and New Jersey exempt clothing from sales tax, while others tax it fully. A few states have price thresholds for clothing tax exemptions.
Online Purchases
Online retailers now collect sales tax in most states based on your shipping address. The rate depends on your location, not the retailer's.
Sales Tax Shopping Strategies
Tax-Free Weekends
Many states offer tax-free shopping weekends, typically before back-to-school season. During these periods, certain items (usually clothing, school supplies, and computers) are exempt from sales tax, offering significant savings on large purchases.
Border Shopping
If you live near a state with lower or no sales tax, making major purchases there can save significant money. For example, shopping in Delaware (no sales tax) versus Maryland (6% tax) saves $60 on a $1,000 purchase.
Business Purchases
Businesses with valid resale certificates can often purchase inventory tax-free, paying sales tax only when selling to end consumers. This is called a sales tax exemption for resale.
Use Tax Obligations
When you buy from out-of-state sellers who don't collect sales tax, you may owe "use tax" to your state at the same rate. Few people report this, but it's technically required in most states.
Frequently Asked Questions
How do I calculate sales tax on a purchase?
To calculate sales tax, multiply the item price by the tax rate (as a decimal). For example, with a 7% tax rate: $100 × 0.07 = $7 tax. Add this to the original price for a total of $107. Our calculator handles this automatically and can also reverse the calculation if you need to find the pre-tax price.
Why does sales tax vary by location?
Sales tax rates are set by state, county, and city governments independently. States set a base rate, then counties and cities can add their own local taxes. This means someone in Los Angeles might pay 9.5% total while someone in a rural California area pays only the 7.25% state rate. Always use your specific local rate for accurate calculations.
Which items are exempt from sales tax?
Common exemptions include groceries (unprepared food), prescription medications, some clothing (varies by state), and services like healthcare. Many states also exempt textbooks, medical equipment, and agricultural supplies. However, rules vary significantly by state - what's exempt in one state may be taxed in another.
Do I pay sales tax on online purchases?
Yes, most online purchases now require sales tax. After the 2018 Supreme Court decision in South Dakota v. Wayfair, online retailers must collect sales tax based on where items are shipped. The tax rate matches your local rate (state + county + city), not the seller's location. Very small sellers may still be exempt.
What are tax-free weekends and how do they work?
Tax-free weekends are special periods (usually 2-3 days) when states waive sales tax on certain items, typically before back-to-school season. Common exempt items include clothing, school supplies, and computers under specific price limits. For example, you might save $60 in tax on a $1,000 laptop purchase during a tax-free weekend.
How can I remove sales tax from a total to find the original price?
Divide the total price by (1 + tax rate). For example, if you paid $107 total with 7% tax: $107 ÷ 1.07 = $100 original price. This reverse calculation is useful for budgeting, reimbursements, or understanding how much of your payment was actual cost versus tax. Our calculator does this automatically in "Remove Tax" mode.
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