The formula
Sales tax = price × tax rate. Total = price × (1 + tax rate). For a $50 item at 8.25%, tax is $50 × 0.0825 = $4.13 and the total is $54.13. Our sales tax calculator handles any rate.
Working backwards
If you only know the total paid, divide by (1 + rate) to find the price before tax. A $108 receipt at 8% means a pre-tax price of $108 ÷ 1.08 = $100 and tax of $8. This is useful for expense reports and comparing prices.
Why rates vary in the US
There's no national sales tax in the United States. Most states charge a state sales tax, and many counties and cities add their own local tax on top, so the combined rate can differ between neighboring towns. A handful of states have no statewide sales tax. Some states exempt or reduce tax on groceries, clothing or medicine.
Sales tax vs. VAT
Many other countries use a value-added tax (VAT) or goods and services tax (GST), usually already included in the displayed price. In the US, sales tax is normally added at the register, which is why the price on the shelf isn't what you pay.
Online purchases
Most online retailers now collect sales tax based on the delivery address. When comparing a local store with an online seller, compare the final totals including tax and shipping.
Tax-free weekends
Several states hold sales-tax holidays, often before the school year, when certain items such as clothing and school supplies are exempt up to a limit. Planning large purchases around them can save money.
Budgeting tip
When planning a big purchase, add tax up front. A $1,200 laptop at 7% costs $1,284, an $84 difference that's easy to forget. Combine this with our discount calculator during sales: apply the discount first, then the tax.
For small businesses
Sellers must usually register, collect the correct combined rate and file returns regularly. Rules are complex, so official state revenue department guidance or an accountant is important.
Frequently asked questions
How do I calculate sales tax?
Multiply the price by the tax rate; add it to the price for the total.
How do I find the price before tax?
Divide the total by (1 + tax rate).
Is there a national sales tax in the US?
No; sales tax is set by states and local governments.
Is tax applied before or after a discount?
Usually the discount is applied first, then tax on the reduced price.