Three sales tax calculations
- Add tax: total = price × (1 + rate).
- Remove tax: price = total ÷ (1 + rate). Subtracting the rate from the total gives the wrong answer.
- Find the rate: rate = (total ÷ price) − 1.
How US sales tax works
There's no national sales tax in the US. Most states charge one, and many counties and cities add their own, so your total rate depends on where you buy. Combined rates run from 0% in a few states to over 10% in some cities. Some items, such as groceries or prescription drugs, are exempt or taxed at lower rates in many states.
Example
A $100 item at 7.25% sales tax costs $107.25. Working backward, a $107.25 receipt at 7.25% means the price before tax was exactly $100.00.
Frequently asked questions
Which states have no sales tax?
Alaska, Delaware, Montana, New Hampshire and Oregon have no statewide sales tax, though some Alaska towns charge local tax.
Is sales tax charged on shipping?
It depends on the state. Some tax shipping charges and some don't.