How to Calculate Sales Tax (and Take It Out of a Total)
Add sales tax or VAT to a price, remove it from a tax-inclusive total, or find the rate you were charged, with simple formulas and a free calculator.
Published
Free tool: Sales Tax CalculatorSales tax questions come in three forms: what will this cost with tax, how much of this total was tax, and what rate was I charged? Each has a simple formula, and the second one trips up a lot of people. This guide covers all three, using the free Sales Tax Calculator.
Adding tax to a price
Total = price × (1 + tax rate)
A $100 item at 8.25% sales tax: tax is $8.25, and the total is $108.25.
Removing tax from a total
To find the price before tax, divide; don't subtract the percentage:
Price before tax = total ÷ (1 + tax rate)
From a $108.25 total at 8.25%: $108.25 ÷ 1.0825 = $100, so the tax was $8.25. Taking 8.25% off $108.25 would give $99.32, which is wrong, because the tax was calculated on $100, not on $108.25.
The same applies to VAT and GST, which are usually included in shelf prices: a $120 price including 20% VAT is $100 plus $20 of VAT.
Finding the tax rate
Tax rate = (total − price) ÷ price
If a $100 item cost $107 at the register, the rate was $7 ÷ $100 = 7%.
Sales tax in the US
- There's no national sales tax; rates are set by states, and many counties and cities add their own, so the combined rate depends on where you buy.
- A few states have no statewide sales tax, and some exempt groceries, clothing or medicine.
- Online purchases are generally taxed at the rate where the item is delivered.
Look up the combined rate for your address, since it can differ from the state rate by several points.
Common rates
| Rate | Tax on $100 | Total |
|---|---|---|
| 5% | $5.00 | $105.00 |
| 7% | $7.00 | $107.00 |
| 8% | $8.00 | $108.00 |
| 10% | $10.00 | $110.00 |
| 20% (typical VAT) | $20.00 | $120.00 |
For sale prices and coupons, see How to Calculate a Discount.
How to use the Sales Tax Calculator
- Open the Sales Tax Calculator.
- Choose what to calculate: add tax to a price, remove tax from a total, or find the tax rate.
- Enter the price, the total including tax, or both, and the tax rate (your combined sales tax or VAT/GST rate).
- Read the results: the price before tax, the tax and the total with tax, with a chart of price vs tax and a table of common rates.
Frequently asked questions
How do I calculate sales tax on a price?
Multiply the price by the tax rate. 8.25% on $100 is $8.25, for a total of $108.25.
How do I take sales tax out of a total?
Divide the total by 1 plus the tax rate. $108.25 ÷ 1.0825 = $100 before tax.
How do I find the sales tax rate from a receipt?
Subtract the price before tax from the total and divide by the price before tax. $7 of tax on $100 is a 7% rate.