Sales Tax Calculator

How Sales Tax Works in the United States

If you've ever looked at a receipt and wondered why the total didn't match the sticker price, you're not alone. Sales tax in the US is a consumption tax applied at the point of sale, and it varies wildly depending on where you live. I've put together this calculator because figuring out the exact tax on a purchase shouldn't require a spreadsheet.

There's a common misconception that sales tax is uniform across each state, but that's far from the truth. Many states allow cities and counties to add their own local taxes on top of the state rate. For example, California has a 7.25% state rate, but combined with local taxes, you might pay over 10% in some areas of Los Angeles.

What Is Sales Tax?

According to Wikipedia, a sales tax is a tax paid to a governing body for the sale of certain goods and services. Usually laws allow the seller to collect funds for the tax from the consumer at the point of purchase. Five US states (Alaska, Delaware, Montana, New Hampshire, and Oregon) do not impose a state-level sales tax, though Alaska allows local municipalities to levy sales taxes.

Reverse Sales Tax Calculation

One of the features I'm most proud of in this tool is the reverse calculator. Let's say you paid $108.25 total and you know the tax rate was 8.25%. You can use the reverse tab to find out the pre-tax price was exactly $100. pre-tax price = total / (1 + tax rate). It's incredibly useful for expense reports and bookkeeping.