Sales Tax Calculator

What is Sales Tax?

Sales tax is a consumption tax imposed by state and local governments on the sale of goods and services. For businesses, staying compliant with sales tax rules is crucial to avoid penalties, maintain trust with customers, and ensure accurate financial reporting.

Different states, and cities within states, can have drastically different sales tax rates. That’s why understanding your total sales tax liability is essential.

How to Calculate Sales Tax

To calculate the total sales tax owed on a transaction:

• Sales Tax = Purchase Amount × (State Rate + Local Rate)

For example, if you sell a $100 item in a state with a 5% state rate and a 2.5% local rate:

• Sales Tax = $100 × 7.5% = $7.50

Our calculator makes this process instant and accurate by combining state + average local sales tax rates across the U.S.