How to Calculate Sales Tax Calculators

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Sales tax is a consumption tax charged at the point of sale, calculated as a percentage of the purchase price. In the United States, sales tax rates vary by state, county, and city — there is no federal sales tax. Calculating sales tax requires knowing the tax rate and the pre-tax price. The two main calculations are: finding the tax amount (price × tax rate) and finding the total price after tax (price × (1 + tax rate)). Reverse sales tax calculations work backward from the total price to find the pre-tax amount.

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Sales Tax Formulas

Tax amount = Price × Tax rate

Total price = Price × (1 + Tax rate)

Example: $45.00 purchase at 8.5% tax. Tax = $45.00 × 0.085 = $3.83. Total = $45.00 × 1.085 = $48.83.

Reverse Sales Tax (Finding Pre-Tax Price)

Pre-tax price = Total price / (1 + Tax rate)

Example: total paid $54.75, tax rate 9.5%: pre-tax = $54.75 / 1.095 = $50.00. Tax paid = $4.75.

US State Sales Tax Rates (approximate 2025)

  • California: 7.25% state + local (up to 10.75% combined)
  • Texas: 6.25% state + local (up to 8.25%)
  • New York: 4% state + local (NYC 8.875%)
  • Florida: 6% state + local (up to 8%)
  • No sales tax states: Oregon, Montana, New Hampshire, Delaware, Alaska (state level)

Combined State and Local Rates

The total sales tax rate is state rate + county rate + city rate. In Los Angeles, CA: 7.25% (state) + 2.25% (county) = 9.5% combined. Always use the combined rate for your specific location. Use your state's department of revenue website for exact rates.

Glossary

Sales Tax
A consumption tax charged at the point of sale as a percentage of the purchase price; set by state and local governments in the US; no federal sales tax exists.
Combined Sales Tax Rate
State rate + county rate + city rate for a specific location; must be used for accurate tax calculations; varies widely within and between states.
Reverse Sales Tax
Calculation to recover pre-tax price from a tax-inclusive total: pre-tax = total / (1 + tax rate); used in accounting and expense reimbursement.

Frequently Asked Questions

Tax amount = price × tax rate (decimal). Total price = price × (1 + tax rate). Example: $80 item at 7% tax: tax = $80 × 0.07 = $5.60; total = $80 × 1.07 = $85.60. Use the combined state + local rate for your location — local taxes can add 1–3% on top of the state rate. In the US, sales tax is typically added at checkout rather than included in the listed price, unlike VAT systems in Europe.

Pre-tax price = total / (1 + tax rate). Example: paid $107.50, tax rate 7.5%: pre-tax = $107.50 / 1.075 = $100.00. Tax paid = $7.50. This reverse calculation is used in accounting, expense reports, and to verify the correct amount was charged. Always use the actual combined rate (state + local) that applied to the specific transaction location.

Five states have no statewide sales tax: Oregon, Montana, New Hampshire, Delaware, and Alaska (though Alaska allows local sales taxes up to ~7%). These states typically collect higher income or property taxes instead. Online sales tax rules depend on the seller's economic nexus following the 2018 South Dakota v. Wayfair Supreme Court decision — most online retailers now collect sales tax in states where they meet sales or transaction thresholds, even without physical presence.

Your total sales tax = state rate + county rate + city rate. For example: Houston, TX = 6.25% (state) + 2% (Houston city) = 8.25%. Rates can differ significantly by neighborhood in the same city if city and district boundaries vary. For precise rates for a specific address, use your state's department of revenue rate lookup tool or services like Avalara or TaxJar. Keeping the correct combined rate is important for business sales tax compliance and remittance.