How sales tax is calculated
Sales tax is a percentage added to the listed price at checkout. The formula is tax = price × rate% ÷ 100, and the total = price + tax. On a $100 purchase at an 8.25% rate, the tax is 100 × 0.0825 = $8.25 and you pay $108.25 in total. Tax is charged on the reduced price, so apply the percent off calculator first.
How to use this calculator
Enter the price of the item before tax and your local tax rate as a percentage. The result shows the tax added and the final total. Rates vary widely by state and city, so use the combined rate that applies where you are buying. To work out a tip on the pre-tax amount, see the tip calculator.
US rates span a wide range: five states (Alaska, Delaware, Montana, New Hampshire and Oregon) charge no state sales tax at all, while combined state plus local rates reach roughly 9–10% in parts of Louisiana, Tennessee and California. Many states also exempt groceries and prescription medicine, or tax them at a reduced rate. Multi-step or stacked promotions are handled by the discount calculator.
Worked example
Buying a $250 jacket where the combined sales tax is 7%: the tax is 250 × 0.07 = $17.50, so the total is $267.50. If you are splitting a taxed restaurant bill, the bill split calculator can divide the final total among your group.
If you already know the tax-inclusive total and want the price before tax, divide by 1 plus the rate: $267.50 ÷ 1.07 = $250.00.
Frequently asked questions
- How do I calculate sales tax?
- Multiply the price by the tax rate as a decimal. On a $100 item at 8.25%, the tax is 100 × 0.0825 = $8.25.
- What is 8.25% tax on $100?
- $8.25, making the total price $108.25.
- What tax rate should I use?
- Use the combined state and local rate for where you are buying. Sales tax rates differ by state, county and city.
- Is sales tax added before or after a discount?
- Tax is normally applied after discounts, on the reduced price you actually pay. Enter that discounted price here.
- Why do European prices not need a sales tax calculation?
- Because EU and UK shelf prices are quoted VAT-inclusive, so the tax is already inside the number you see. US prices exclude sales tax and it is added at the register, which is exactly what this calculator models.