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How to Calculate Sales Tax

The price on the tag is probably not the price you will end up paying. Follow these steps to determine how much your new purchase will really cost.

Instructions

  • Step 1: Determine the purchase amount Determine the purchase amount of the taxable items you will buy.
  • TIP: Subtract all coupons and discounts.
  • Step 2: Determine the sales tax percentage Determine the sales tax rate percentage, which will vary state-to-state.
  • Step 3: Turn the percentage into a decimal Turn the percentage into a decimal. Move the decimal place two spaces to the left of the number. For example 12.5 percent would equal .125 and 6 percent would equal .06.
  • Step 4: Multiply the two numbers Multiply the purchase price and the sales tax decimal to calculate the sales tax amount.
  • TIP: Use a calculator if needed.
  • Step 5: Add the tax Add the sales tax amount to the purchase price for the total amount due, and enjoy knowing what you paid before the cashier does.
  • FACT: As of 2010, the state of California had the United States' highest sales tax rate at 8.25 percent.

You Will Need

  • Purchase price
  • Sales tax percentage
  • Basic math skills
  • Calculator (optional)

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