About Sales Tax Math
Sales tax touches nearly every US purchase, yet two calculations trip people constantly: what a listed price will really cost at the register, and — for expense reports, budgets, and resellers — how much of a receipt total was tax. The second one has a genuinely counter-intuitive formula, which is why spreadsheets full of subtracted percentages are quietly wrong.
Pick a direction, enter the amount and your local combined rate, and get the tax and the answer with its working. The reverse mode is the one accountants call “backing out” tax — used for invoices, VAT-style receipts, and any time a total is tax-inclusive.
Working with value-added tax abroad instead? That's the VAT Calculator.
Both Directions, Done Right
The forward direction is obvious; the reverse is the one worth memorizing:
Add tax: total = price × (1 + rate/100) Back out: price = total ÷ (1 + rate/100) ← divide, don't subtract! tax = total − price
Worked example: $100 at 8.25% → $8.25 tax, $108.25 total. Reversing: $108.25 ÷ 1.0825 = $100.00 exactly. The wrong way — subtracting 8.25% from $108.25 — gives $99.32, and that 68-cent error compounds across every line of an expense report.
Tax per $100 at Common Rates
Combined state + local rates across the US mostly land between 5% and 10% — the register math at each:
| Combined rate | Tax on $100 | Total |
|---|---|---|
| 5% | $5.00 | $105.00 |
| 6% | $6.00 | $106.00 |
| 7% | $7.00 | $107.00 |
| 8% | $8.00 | $108.00 |
| 8.25% | $8.25 | $108.25 |
| 9% | $9.00 | $109.00 |
| 10% | $10.00 | $110.00 |
The mental shortcut: the rate IS the dollars per hundred — 8.25% means $8.25 on every $100, so a $450 purchase carries about 4.5 × $8.25 ≈ $37 of tax.
How US Sales Tax Actually Works
Your rate is a stack: a state rate plus county, city, and special-district add-ons, which is why the combined figure differs across a metro area and can pass 10% in some cities. Five states charge no statewide sales tax at all — New Hampshire, Oregon, Montana, Delaware, and Alaska (which allows local rates). Groceries, clothing, and medicine get reduced or zero rates in many states, so one receipt can carry two different rates legitimately.
Online purchases now generally charge the rate at your delivery address (post-2018 Wayfair rules), so the days of tax-free carts are mostly gone. For the exact combined rate where you live, your state revenue department publishes lookup tools — enter that figure here and the math is done at your true rate, never a stale average.