Sales Tax Calculator

How to use the sales tax calculator

Enter an amount, your combined sales tax rate, and pick a mode. In add mode, which is the default, the amount you type is the pre-tax price and the tool returns the tax and the all-in total. In remove mode the amount is a tax-inclusive total and the tool works backward to the pre-tax price.

The rate field defaults to 7.25 percent, which is California’s statewide rate and happens to be the highest state-level rate in the country, but it is only a placeholder. There is no single correct number to prefill here, so type the rate that applies where the sale actually happens rather than accepting the default.

US prices are almost always displayed tax-exclusive: the shelf or menu price is the pre-tax figure and tax is added at the register, so the number you see is not the number you pay. That is what add mode mirrors, and it is the mode you want for budgeting a purchase, checking a quote, or confirming the tax line on a receipt.

Much of the rest of the world prices the other way. In the United Kingdom, value-added tax at a standard rate of 20 percent, unchanged since January 2011, is already inside the displayed price, and the same tax-inclusive convention applies across the European Union and in most countries that run a VAT or GST.

A tag in Paris is what you hand over; a tag in Portland, Oregon happens to be too, because Oregon has no sales tax at all.

Remove mode exists because backing tax out of a total is the calculation people actually need most often. Expense reports, bookkeeping and VAT reclaims all start from a receipt that shows only a grand total and a rate, and they need the net amount and the tax portion separately. Divide the total by 1 plus the rate to recover the pre-tax price, then subtract to find the tax, and the two modes will always round-trip each other exactly.

Why does the rate change from one address to the next?

There is no federal sales tax in the United States. Rates are set by states and then by counties, cities and special districts on top, and they stack into a combined rate at the point of sale. Alaska has no statewide rate but its localities average 1.82 percent.

Two addresses a few miles apart in the same state can owe different amounts, which is why this tool asks for your rate instead of guessing one, and why the reference table above quotes averages rather than a figure you can file with.

The formula, worked line by line

Convert the rate to a decimal first, then the two modes are exact inverses of each other. One multiplies the tax on and the other divides it back out, which is why a total produced by add mode returns the original amount when you put it through remove mode.

The asymmetry that trips people up is in the second line. Adding tax scales the pre-tax figure up by 1 plus the rate, so removing it must divide by that same factor rather than subtract the percentage. Subtraction operates on the wrong base, because the tax was a slice of the smaller number.

rate = tax% ÷ 100
add tax     →  tax = amount × rate,  total = amount + tax
remove tax  →  pre-tax = amount ÷ (1 + rate),  tax = amount − pre-tax
107.25 ÷ 1.0725 = 100.00

Now see why subtraction fails. Taking 7.25 percent off the $107.25 total gives 107.25 × 0.0725 = $7.78, which overshoots the $7.25 actually charged by 53 cents, because 7.25 percent of the gross total is larger than 7.25 percent of the net amount that was taxed.

The error grows with the rate: at a 10 percent rate, subtracting 10 percent from a $110.00 total removes $11.00 instead of $10.00, and at 20 percent VAT the shortcut is wrong by a fifth of the tax. Divide by 1 plus the rate every time.

Two limits on what this tells you. First, the rate is yours to supply and it is jurisdiction-specific: a combined rate is the state rate plus county, city and special-district rates at the point of sale, and rates change on their own local schedules.

Second, taxability varies as much as rates do, since many states exempt groceries, prescription drugs or clothing entirely, so the correct rate for a given basket may not be the headline rate at all. This page is general information about arithmetic and published rate data, not tax advice; check with your state revenue department or a tax professional before filing anything.

Questions people ask