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How do I calculate sales tax on a purchase?

Short answer

Multiply the price by the tax rate as a decimal to get the tax, then add it to the price for the total. On a 50 item at an 8 percent rate, the tax is 50 x 0.08 = 4, for a total of 54. A free sales tax calculator does both steps in your browser and can also work backward from a total.

Tax amount and total price

Convert the percentage to a decimal and multiply: an 8 percent rate is 0.08, so on a 50 purchase the tax is 4 and the total is 54. A one-step shortcut for the total is to multiply by 1 plus the rate: 50 x 1.08 = 54. Both methods give the same answer; the shortcut is handy when you only care about the final total.

Rates differ, so do not assume

Sales tax rates vary widely by country, state, province and even city, and some places layer several taxes together. The arithmetic is always the same multiplication, but the rate is not universal, so enter the rate that actually applies where the purchase happens. To find the pre-tax price from a total, divide by 1 plus the rate: a 54 total at 8 percent came from 54 / 1.08 = 50.

Frequently asked questions

What is 8 percent sales tax on 50?

4 in tax, for a total of 54. Multiply 50 by 0.08 for the tax, or by 1.08 for the total directly.

How do I find the price before tax?

Divide the total by 1 plus the rate. A 54 total at 8 percent was 54 / 1.08 = 50 before tax.

Is the sales tax rate the same everywhere?

No. Rates vary by location and sometimes combine multiple taxes. Use the rate that applies where you are buying.

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