Sales Tax Calculator
Calculate sales tax, find tax rates, or determine pre-tax amounts
Sales Tax Estimator
Calculate sales tax, find tax rates, or determine pre-tax amounts
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States with No Sales Tax:
Common Tax Scenarios:
Restaurant Bills
Tax added to food and serviceOnline Shopping
May include destination-based taxBusiness Expenses
Track tax for deductionsTravel Purchases
Different rates by locationUnderstanding Sales Tax and Smart Shopping
Sales tax is a consumption tax imposed by state and local governments on the sale of goods and services. Understanding how sales tax works and being able to calculate it accurately is essential for budgeting, business operations, and making informed purchasing decisions.
Sales tax rates vary significantly across the United States, with some states having no sales tax at all while others can exceed 10% when combining state and local rates. Five states currently have no state sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. However, some of these states allow local municipalities to charge their own sales taxes.
The complexity of sales tax extends beyond just different rates. Different types of items may be taxed differently or exempt entirely. Many states exempt groceries, prescription medications, and sometimes clothing from sales tax. Some states have tax holidays where certain items can be purchased tax-free during specific periods, often for back-to-school shopping or emergency preparedness.
For businesses, understanding sales tax is crucial for pricing strategies and compliance. Retailers must collect the appropriate sales tax and remit it to the government. With the rise of e-commerce, sales tax collection has become more complex, as businesses may need to collect taxes for multiple states depending on where they have nexus (a significant presence).
When shopping online, sales tax can significantly impact the final price. The 2018 Supreme Court decision in South Dakota v. Wayfair allowed states to require online retailers to collect sales tax even if they don't have a physical presence in the state. This means consumers now pay sales tax on most online purchases, making it important to factor tax into price comparisons between online and brick-and-mortar stores.
For international travelers and tourists, understanding sales tax can lead to significant savings. Many states offer tax-free shopping for international visitors who can prove they're taking purchases out of the country. Additionally, shopping in states with lower or no sales tax can result in substantial savings on big-ticket items.
Frequently Asked Questions
Five states have no state sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. However, Alaska allows local municipalities to charge sales tax, so some areas in Alaska do have sales tax.
Sales tax is typically calculated on the final sale price after any discounts are applied. If an item originally costs $100 with a 20% discount, you pay tax on the $80 sale price, not the original $100.
In most cases, yes. Since the 2018 Wayfair decision, online retailers are required to collect sales tax in states where they meet certain thresholds, even without a physical presence. Most major online retailers now collect sales tax in all applicable states.
Common exemptions include groceries, prescription medications, and in some states, clothing. However, exemptions vary widely by state. Some states also exempt newspapers, educational materials, or items for manufacturing.
To find the pre-tax price, divide the total by (1 + tax rate). For example, if the total is $108 with an 8% tax rate, the calculation is: $108 ÷ 1.08 = $100.