How sales tax calculator works
This calculator handles two sales tax scenarios. In standard mode, it adds tax to a price: the tax amount is the price times the rate divided by 100, and the final price is the original plus the tax. For example, 100 at 8.5% tax gives 8.50 in tax and a final price of 108.50.
In tax-inclusive mode, the price already includes tax. The calculator extracts the tax by dividing the price by (1 + rate/100) to find the pre-tax amount, then subtracting. For example, if 108.50 includes 8.5% tax, the pre-tax price is 100 and the tax is 8.50.
This is useful for shopping, invoicing, and VAT calculations. Sales tax rates vary widely by jurisdiction; check your local rate. The calculator rounds to two decimal places.
Frequently asked questions
How do I calculate sales tax?
Multiply the price by the tax rate and divide by 100 to get the tax amount, then add it to the price. For example, 100 at 8% tax is 100 times 0.08 = 8 in tax, final price 108.
How do I find the price before tax?
If the price includes tax, divide by (1 + rate/100). For example, if 108 includes 8% tax, the pre-tax price is 108 / 1.08 = 100. The tax portion is 8.
What is the difference between sales tax and VAT?
Sales tax is applied once at the point of sale to the final consumer. VAT (value added tax) is applied at each stage of production but only on the value added. This calculator works for both.
What tax rate should I use?
Tax rates vary by country, state, and city. Check your local jurisdiction for the correct rate. US sales tax averages 6-9%, while European VAT is typically 19-25%.
