The Short Answer
Sales tax in the US is set at the state level, then local counties and cities often add their own tax on top. The rate you actually pay at the register is the combined rate — state base plus all local add-ons. State base rates range from 0% to 7.25% (California has the highest base rate), and five states charge no statewide sales tax at all.
To find what you’ll pay, multiply the price by 1 plus the combined rate as a decimal. The sales tax calculator does this for any rate in a second, but the math is straightforward once you see it.
How Sales Tax Works
Sales tax isn’t a single national number — it’s layered:
- State base rate — the statewide rate set by the legislature (e.g., Texas is 6.25%).
- Local add-ons — counties, cities, and special districts can tack on additional percentage points.
- Combined rate — the total you actually pay = state base + local add-ons.
That’s why two stores in the same state can charge different sales tax: a purchase in a city with a 2% local tax costs more than one in an unincorporated area with none.
The Sales Tax Formula
To calculate the total price including tax:
Total = Price × (1 + rate ÷ 100)
And to find just the tax amount:
Tax = Price × (rate ÷ 100)
Worked Example
You’re buying a $200 item in a location with a combined 8.25% rate:
Tax = $200 × (8.25 ÷ 100) = $16.50
Total = $200 × 1.0825 = $216.50So you pay $216.50 at the register, $16.50 of which is tax.
Watch the combined rate, not just the state rate. A state base of 6.25% can become 9% or more once city and county taxes are added. Always use the combined rate for the location where the sale happens.
The 5 States With No Sales Tax
Five states have no statewide sales tax. An easy way to remember them is the acronym NOMAD:
- New Hampshire
- Oregon
- Montana
- Alaska
- Delaware
One important caveat: Alaska has no state sales tax, but local municipalities can charge their own. Some Alaskan towns levy local sales taxes of several percent, so “no sales tax” isn’t always true at the register there. The other four are tax-free statewide.
Notable State Base Rates
These are state base rates only — your final combined rate will often be higher once local taxes are added.
| State | Base Rate |
|---|---|
| California | 7.25% |
| Tennessee | 7.00% |
| Nevada | 6.85% |
| Washington | 6.50% |
| Texas | 6.25% |
| Illinois | 6.25% |
| Florida | 6.00% |
| Pennsylvania | 6.00% |
| Michigan | 6.00% |
| Ohio | 5.75% |
| Arizona | 5.60% |
| Louisiana | 4.45% |
| New York | 4.00% |
| Georgia | 4.00% |
| Colorado | 2.90% |
California has the highest base rate at 7.25%, while Colorado has the lowest non-zero base at just 2.90%.
Combined Rates Can Exceed 10%
Don’t be fooled by a low base rate. Local add-ons can push the combined rate above 10%. Colorado’s 2.90% base looks tiny, but some Colorado cities reach into double digits once county, city, and special-district taxes stack up. Louisiana and Tennessee also routinely see combined rates near or above 9-10% because local jurisdictions add several points on top of the state rate.
The takeaway: a state’s base rate tells you the floor, not the final number. To budget accurately, you need the combined rate for the specific city or ZIP code where you’re buying.
How to Calculate It
- Find the combined rate for the location (state base + local). Check your state’s department of revenue or a rate lookup tool.
- Convert to a decimal — divide the percentage by 100 (8.25% → 0.0825).
- Multiply for the tax — Price × 0.0825.
- Add it on — Price + tax, or just Price × 1.0825 for the total in one step.
If you’re stacking a coupon on top of a taxed purchase, remember that tax is usually applied after the discount. Run the markdown first with the discount calculator, then apply tax to the reduced price.
Frequently Asked Questions
Which states have no sales tax? Alaska, Delaware, Montana, New Hampshire, and Oregon have no statewide sales tax. Note that some Alaskan localities still charge their own local sales tax.
What state has the highest sales tax? California has the highest state base rate at 7.25%. However, with local add-ons, several states reach combined rates above 9-10%, so the highest combined rate depends on the specific city.
Is sales tax calculated before or after a discount? Almost always after. Stores apply the discount first, then charge sales tax on the lower, post-discount price.
How do I calculate sales tax on a purchase? Multiply the price by the combined rate as a decimal. For an 8% rate on a $50 item: $50 × 0.08 = $4 in tax, for a $54 total.
The Bottom Line
Sales tax is a state base rate plus whatever local taxes apply, and the number that matters is the combined rate for your exact location. The formula is simple — Total = Price × (1 + rate ÷ 100) — but the rates vary widely, from 0% in the NOMAD states to over 10% combined in some cities. To skip the arithmetic, plug your price and rate into the sales tax calculator, and use the discount calculator first if you’re applying a coupon.