—
—
Adding and removing sales tax
Sales tax and VAT are added to the price of goods and services at the point of sale, and the rate varies enormously — under 5% in some US states, 20% or more across much of Europe. This sales tax calculator runs in both directions: add tax to a net price to get the total a customer pays, or strip tax back out of a gross total to find the net figure your books need.
How to use the Sales Tax Calculator
- Enter the Amount you already know.
- Enter the Tax Rate (%) that applies in your state or country.
- Choose the Calculation Type — adding tax on, or taking it back out.
- Read the net amount, the tax, and the total together.
Formula and a worked example
Add: Tax = Net × r · Gross = Net × (1 + r)
Remove: Net = Gross ÷ (1 + r) · Tax = Gross − Net
As with GST, removing tax needs division, not subtraction. Taking 20% off a gross total gives the wrong answer because the 20% was charged on the smaller net figure.
Worked example
A receipt totals 162.38 with 8.25% sales tax included. Dividing gives 162.38 ÷ 1.0825 = 150.00 net, so the tax was 12.38. Subtracting 8.25% of 162.38 would have suggested 13.40 — about a rupee too much on every hundred.
Frequently asked questions
How do I remove sales tax from a total?
Divide the gross total by (1 + rate). At 8.25%, divide by 1.0825; the difference between the two figures is the tax.
Is sales tax the same as VAT?
The arithmetic is identical. The difference is administrative — VAT is collected at each stage of the supply chain, sales tax only at the final sale.
Do I apply tax before or after a discount?
After. Discount the price first, then charge tax on the reduced amount.
Why do two shops in the same country charge different rates?
In the United States sales tax is set locally, so the rate changes by state, county and sometimes city. Always use the rate on your own receipt.
Related calculators
Other tools people use alongside the sales tax calculator.