New York City sales tax is 8.875 percent

The combined sales tax rate in New York City is 8.875 percent. This rate is the sum of the New York State sales tax (4 percent), the Metropolitan Transportation Authority tax (0.375 percent), and the New York City sales tax (4.5 percent). The rate applies to most goods and some services you buy within the five boroughs.

The 8.875 percent rate has been in place since 2010. It applies uniformly across Manhattan, Brooklyn, Queens, the Bronx, and Staten Island. When you see a price tag in a store, the amount shown does not include this tax — it will be added at checkout.

Key Takeaways

  • New York City's combined sales tax rate is 8.875 percent, made up of state, city, and transit authority taxes.
  • Sales tax applies to most clothing, electronics, groceries at prepared food counters, and restaurant meals, but not to unprepared groceries or prescription medications.
  • The tax is collected by the retailer at the point of sale and sent to the state and city tax departments.
  • Some items are exempt from sales tax under New York State law, and these exemptions apply in New York City as well.

What items are taxed and what are not

Most physical goods are subject to the 8.875 percent tax. Clothing, shoes, electronics, furniture, books, and toys all carry sales tax. Restaurant meals and prepared foods from delis or food counters are taxed. Beverages including soda, juice, and coffee are taxed whether you buy them at a café or a grocery store.

Several categories are exempt from sales tax in New York City. Unprepared groceries — raw vegetables, fruits, meat, dairy, bread, and canned goods you take home to cook — are not taxed. Prescription medications and medical devices are exempt. Newspapers and magazines are not taxed. Items purchased with food stamps (now called SNAP benefits) are exempt from tax at the register.

The line between taxed and untaxed can be unclear for some items. Hot prepared food is taxed; cold prepared food is sometimes taxed depending on how it is packaged and sold. A sandwich from a deli counter is taxed. A loaf of bread from the bakery section is not. If you are unsure whether a specific item will be taxed, ask the cashier before you pay.

How the tax is calculated and collected

The retailer calculates the tax based on the sale price and the 8.875 percent rate. For a $100 purchase, the tax is $8.88 (rounded to the nearest cent). The retailer collects this tax from you at checkout and is required by law to send it to the New York State Department of Taxation and Finance, which distributes portions to the city and the Metropolitan Transportation Authority.

You do not file anything or pay the tax separately. The tax is built into the transaction at the register. Online purchases shipped to a New York City address are also subject to sales tax, though some online retailers may not collect it depending on their location and business structure.

Sales tax in the five boroughs

The 8.875 percent rate applies uniformly across all five boroughs of New York City. You will pay the same tax rate whether you shop in Manhattan, Brooklyn, Queens, the Bronx, or Staten Island. There are no neighborhood variations or special zones with different rates.

If you travel outside New York City to surrounding counties in New York State, the sales tax rate changes. Westchester County, Nassau County, and other nearby areas have different combined rates. But within the city limits, the rate is always 8.875 percent.

Who collects the tax and where it goes

Every retailer — from large chains to small shops — is responsible for collecting sales tax on taxable items. The retailer sends the collected tax to the New York State Department of Taxation and Finance. The state keeps 4 percent for state programs, the city keeps 4.5 percent for city services, and the Metropolitan Transportation Authority receives 0.375 percent to fund public transit.

Retailers must file sales tax returns with the state, usually monthly or quarterly depending on the size of their business. The tax money funds schools, infrastructure, public safety, and the subway and bus systems that serve the city.

Special situations and exceptions

Certain organizations are exempt from collecting or paying sales tax. Nonprofits, religious institutions, and government agencies may not pay sales tax on purchases made for their operations, though they must have the proper documentation to claim the exemption at the register.

If you buy an item in New York City and have it shipped to an address outside the state, sales tax may not apply depending on the retailer's policies and the destination state's laws. Some retailers charge tax based on where the item is shipped; others charge based on where the purchase is made. Check with the retailer if you are unsure.

Frequently Asked Questions

Is sales tax included in the price shown on the shelf?

No. The price tag shows the pre-tax price. Sales tax is added at checkout. For a $50 item, you will pay $50 plus $4.44 in tax, for a total of $54.44.

Do I pay sales tax on groceries?

It depends. Unprepared groceries like raw vegetables, meat, bread, and canned goods are not taxed. Hot prepared foods, deli items, and items from prepared food counters are taxed. Cold prepared foods may or may not be taxed depending on packaging.

What about online shopping — do I pay New York City sales tax?

Yes, if the item is shipped to a New York City address and the retailer collects sales tax. Most major online retailers now collect New York sales tax. Some smaller retailers may not, but they are still legally required to do so.

Are prescription drugs taxed in New York City?

No. Prescription medications are exempt from sales tax in New York State and New York City. Over-the-counter medications and vitamins are taxed.

What if a retailer doesn't charge me sales tax?

The retailer is breaking the law and may face penalties. You are not responsible for reporting it. If you notice a pattern at a specific store, you can report it to the New York State Department of Taxation and Finance.