Calculate sales tax and total price including tax. Free calculator for small business owners, retailers, and eCommerce sellers.
Calculate sales tax and total price including tax. Free calculator for small business owners, retailers, and eCommerce sellers.
Generated: 1/13/2026, 7:22:42 AM | AskSMB.io
Price before sales tax
Applicable local or state sales tax rate
Sales Tax Amount
$0
Tax charged on the sale
Total Price (Including Tax)
$0
Final price paid by the customer
Tax Percentage
0%
Sales tax rate applied
Sales tax is a consumption tax imposed by state and local governments on the sale of goods and services. It's calculated as a percentage of the purchase price and collected by the seller at checkout. The seller acts as a tax collector, remitting the tax to the appropriate government authority. Sales tax is ultimately paid by the consumer, not the business. Rates vary widely by location—some states have no sales tax, while others can exceed 10% when state, county, and local taxes are combined.
Sales tax calculation is straightforward: multiply the product price by the sales tax rate (expressed as a decimal). The formula is: Sales Tax = Price × Tax Rate. For example, a $100 item with 8% tax: $100 × 0.08 = $8 in tax. The total price becomes $100 + $8 = $108. Always use the exact rate for your jurisdiction, which may combine state, county, and city taxes. Different product categories may have different rates or exemptions (groceries, clothing, prescription drugs).
Proper sales tax handling is critical for legal compliance and financial accuracy. Businesses must register for sales tax permits, collect the correct amount from customers, file regular tax returns, and remit collected taxes on time. Errors can result in penalties, interest charges, audits, and legal liability. Sales tax affects pricing strategy, profit margins, cash flow, and accounting. For online businesses, managing sales tax across multiple states (economic nexus) adds complexity. Accurate calculation ensures you don't overcharge customers or underpay the government.