How to Calculate Sales Tax: Worked Examples by State
Sales tax worked out step by step: the same $100 purchase in six states, a discounted item, reversing a receipt total, and finding the rate you were charged.
To calculate sales tax, multiply the price by the tax rate as a decimal: tax = price × rate, and total = price × (1 + rate). The formula never changes. What changes is the rate, and that depends on where you buy. Below are real numbers worked all the way through.
The same $100 purchase in six states
Every state sets a base rate, and most let cities and counties add their own on top. The second pair of columns uses a representative combined rate (state plus average local). Your exact address can be higher or lower.
| State | State rate | Total at state rate | Typical combined rate | Total at combined rate |
|---|---|---|---|---|
| California | 7.25% | $107.25 | 8.82% | $108.82 |
| Texas | 6.25% | $106.25 | 8.20% | $108.20 |
| New York | 4.00% | $104.00 | 8.52% | $108.52 |
| Florida | 6.00% | $106.00 | 7.05% | $107.05 |
| Tennessee | 7.00% | $107.00 | 9.55% | $109.55 |
| Oregon | 0% | $100.00 | 0% | $100.00 |
New York shows why the state rate alone can mislead: the 4% state rate more than doubles once local tax is added. Tennessee has the highest combined rate of the six.
Example: a $249.99 TV in Texas
- Convert the rate: 8.2% = 0.082.
- Tax: $249.99 × 0.082 = $20.499, which rounds to $20.50.
- Total: $249.99 + $20.50 = $270.49.
Example: a discounted item in Florida
Shoes marked $80 are 25% off, so you pay $60. Tax applies to the $60 you actually pay, not the $80 tag:
- Discounted price: $80 × 0.75 = $60.00.
- Tax at 7.05%: $60.00 × 0.0705 = $4.23.
- Total: $64.23.
Taxing the original $80 would give $5.64, which is $1.41 too much. Work out the sale price first with the Discount Calculator, then add tax.
Example: reverse sales tax from a receipt total
A receipt in Tennessee shows a total of $54.76 at 9.55%. To find the pre-tax price, divide by (1 + rate):
- $54.76 ÷ 1.0955 = $49.986, which rounds to $49.99.
- Tax paid: $54.76 − $49.99 = $4.77.
The mistake: subtracting the percentage from the total
Taking 9.55% off $54.76 gives $49.53, which is $0.46 short. The rate was applied to the smaller pre-tax price, so you have to divide by (1 + rate) to undo it. The gap grows as the rate and the amount go up.
Example: find the rate you were charged
Divide the tax by the pre-tax subtotal: rate = tax ÷ subtotal × 100. A receipt with a $42.00 subtotal and $3.68 tax: $3.68 ÷ $42.00 × 100 = 8.76%. Compare that against your area's rate to check you were charged correctly.
The Sales Tax Calculator runs every example above, forward or in reverse, with a state-rate lookup built in. Rates here are planning averages; confirm exact rates with your state's department of revenue.