How to Calculate Sales Tax

how do u calculate sales tax

Lake Delton and Wisconsin Dells impose, as of 2014, a 1.25% sales tax (for a combined rate of 6.75%) while Bayfield, Stockholm, Eagle River, and Rhinelander impose an additional 0.5% for a combined rate of 6.0%. From October 1, 2010, to March 31, 2011, statewide sales and use tax exemption for clothing and footwear sold for less than $110 was eliminated. For New York City, this meant articles of clothing costing less than $110 were charged 4.375% tax. A state sales tax exemption for clothing and footwear under $55 was reinstated from April 1, 2011, through March 31, 2012.

how do u calculate sales tax

Michigan raised the sales tax rate to 6% from 4% in 1994. Michigan Ballot Proposal , which was opposed by 80% of voters, would have raised the sales and use taxes to 7%. In 2007, Michigan passed a law extending the sales tax to services, but repealed it the day it was to go into effect. To date, the highest combined rate of sales tax is 11.6%, at a Holiday Inn Express in Ottawa. Additionally, if a consumer in Kansas does not pay any sales tax at time of purchase, they must declare the unpaid tax on their yearly income tax. Qualifying food, drugs, medicines and medical appliances have sales tax of 1% plus local home rule tax depending on the location where purchased.


All states provide some exemptions from sales tax for wholesale sales, that is, sales for resale. However, some states tax sales for resale through vending machines. If you buy equipment, supplies, or other taxable items for your business and the seller does not charge Minnesota sales tax, you owe use tax on the cost of the items. If your business is located in an area with a local tax, you may also owe local use tax. Or to make things even easier, input the NYC minimum combined sales tax rate into the calculator at the top of the page, along with the total sale amount, to get all the detail you need.

Hawaii law allows businesses to pass on the tax to the consumer in similar fashion to a sales tax. Effective how do u calculate sales tax January 1, 2019, Arkansas’ state sales tax on unprepared food was reduced to 0.125% (1/8 of 1%) from 1.5%.

How to Calculate the Taxable Percentage on an Income Statement

The state capital, Juneau, has a 5 percent sales tax rate. State and local sales tax rates vary from product to product, but are not always applied to services – it depends on the type of service and the state. For more information on calculating sales tax rates, this post offers more information.

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Regulations and exemptions vary widely across the state. The two largest cities, Anchorage and Fairbanks, do not charge a local sales tax.


Many items are exempt from the state sales tax, e.g., food , prescription drugs, clothing and footwear (except for individual items priced greater than $250), newspapers, coffins, and original artwork. Guam has no general sales tax imposed on the consumer with the exception of admissions, use, and hotel occupancy taxes; however, businesses must pay 5% tax on their monthly gross income. There are no separate municipal, county, school district or improvement district taxes. Starting in 2013, Georgia now imposes a one-time title ad valorem tax on all vehicles sold within the state . The TAVT is based on the fair market value of the vehicle. However, Georgia no longer charges sales tax on motorized vehicles, and those purchases that fall into the TAVT taxation system no longer pay the annual ad valorem taxes on vehicles.

  • In New York City, total sales tax is 8.875%, which includes 0.375% charged in the Metropolitan Commuter Transportation District .
  • You can visually confirm your location of interest by entering an address.
  • Arkansas and Nebraska courts have held that reactive chemicals and hot dog casings are not themselves in the final product and therefore their purchase by manufacturers is taxable.
  • It’s knowing how to correctly charge sales tax in each state is where you can run into confusion.

Enter your city and zip code below to find the combined sales tax rate for a location. If you’d like to calculate sales tax with product exemptions, sourcing logic, and shipping taxability, use our sales tax API demo. When selling online, you first need to determine if you are required to collect sales tax from buyers in your buyer’s state. Next, you need to determine the sales tax rate at the buyer’s location. Income tax, property tax, estate tax, and import tax are some common methods of taxation. One tax that just about everyone encounters frequently is the sales tax.

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