Why There Is No Such Thing as "the US Sales Tax Rate"
Almost every country with a consumption tax has one national rate. The United States has none. There is no federal sales tax at all, and what you pay at a till is assembled from up to four separate layers of local government, each with its own authority to set a rate.
That is why a purchase in one town can cost several per cent more than the identical purchase twenty minutes away, and why any single number you have seen quoted for American sales tax is an average rather than a rate.
The layers that stack up
- State: the base rate, ranging from zero to 7.25%.
- County: added on top in most states.
- City or municipality: often the largest single addition after the state rate.
- Special districts: transit authorities, stadium levies, hospital or library districts, each able to add a fraction of a per cent.
Chicago reaches 10.25% this way, and Louisiana carries the highest state average in the calculator at 9.55% while individual parishes go past 11%. The combined rate can change on the opposite side of a street, and it is the reason online sellers cannot simply hard-code a percentage.
The five states with no sales tax
Alaska, Delaware, Montana, New Hampshire and Oregon levy no state sales tax. Four of them show as 0.00% in the calculator. Alaska is the exception that proves the point of this page: it has no state-level tax but permits local jurisdictions to impose their own, so the calculator carries 1.76% for it, the average of those purely local rates. A purchase in Juneau is taxed; one in Anchorage largely is not.
Average Combined Rates by State
The figures below are the state-plus-local averages this calculator loads when you pick a state. They are weighted averages, which means your actual rate will differ depending on where in the state you are.
| State | Average combined | State | Average combined |
|---|---|---|---|
| Oklahoma | 8.99% | New York | 8.52% |
| Missouri | 8.33% | Nevada | 8.23% |
| New Mexico | 7.72% | South Carolina | 7.46% |
| Georgia | 7.35% | Ohio | 7.23% |
| Mississippi | 7.07% | Florida | 7.01% |
| North Carolina | 6.99% | Nebraska | 6.93% |
| New Jersey | 6.60% | Connecticut | 6.35% |
| Pennsylvania | 6.34% | Hawaii | 4.44% |
| Delaware, Montana | 0.00% | New Hampshire, Oregon | 0.00% |
| Alaska (local only) | 1.76% | Louisiana (highest average) | 9.55% |
The tool defaults to 7.25% when no state is selected, which is roughly the national combined average. Selecting a state replaces it with that state's figure, and you can type an exact rate over either if you know the one that applies to your address.
Two Rules That Decide Which Rate Applies
For anything shipped rather than carried out of a shop, the question is which jurisdiction's rate governs, and states answer it in two different ways.
Destination sourcing is the majority rule: the rate is the one where the buyer receives the goods. A seller in one state shipping to another charges the buyer's local combined rate, which is why an online checkout recalculates tax after you enter an address.
Origin sourcing applies in a minority of states for intrastate sales: the rate is the one where the seller is located, regardless of where in the state the buyer is.
Since the 2018 Supreme Court decision in South Dakota v. Wayfair, a seller no longer needs a physical presence in a state to be obliged to collect its tax. Crossing a state's economic threshold, commonly a set number of transactions or dollars of sales into that state, creates the obligation on its own. That ruling is why small online sellers now face filing duties in states they have never set foot in.
What This Calculator Does and Does Not Handle
It computes tax on a price at whatever rate you give it, in both directions: adding tax to a pre-tax price, or extracting the tax already contained in a total. The second is the one people get wrong by hand, because you divide by 1 plus the rate rather than multiplying by the rate.
What it cannot know is whether your specific item is taxed at all. Most states exempt or reduce the rate on groceries, prescription medicine and sometimes clothing, and the definitions are unusually specific, the boundary between a taxable prepared food and an exempt grocery has generated a great deal of litigation. Sales tax holidays suspend the tax on selected categories for a few days a year, and business-to-business purchases for resale are exempt with a certificate.
For an exact figure, look up the rate for the delivery address rather than the state, since that is the level at which it is actually set. For anything with filing consequences, a state revenue department or a tax professional is the right source.