North Carolina's statewide sales tax rate is 4.75 percent
North Carolina charges a 4.75 percent sales tax on most retail purchases. This is the base rate that applies everywhere in the state. However, your actual tax at checkout will often be higher because counties and cities add their own local taxes on top of the state rate.
The total tax you pay depends on where you make the purchase. A county might add 2 percent, a city might add another 0.5 percent, or both. This means the same item costs different amounts in sales tax depending on which city or county you're in. Some North Carolina counties have total rates as low as 6.75 percent; others reach 7.75 percent or higher.
Key Takeaways
- North Carolina's state sales tax is 4.75 percent, but your total tax rate includes county and local additions that vary by location.
- County add-ons range from 2 to 2.75 percent, and some cities add another 0.5 to 1 percent on top of that.
- The lowest combined rate in North Carolina is 6.75 percent; the highest reaches 7.75 percent or more depending on the county and city.
- Groceries, prescription medications, and certain medical equipment are exempt from sales tax in North Carolina.
How county and city taxes stack on top of the state rate
Every North Carolina county adds a local tax to the 4.75 percent state rate. Most counties add 2 percent, but some add 2.25 percent or 2.75 percent. On top of the county rate, certain cities can add their own tax, usually between 0.5 and 1 percent.
This means the total tax you pay is: state rate (4.75%) + county rate (2% to 2.75%) + city rate (0% to 1%). A purchase in Charlotte, for example, is taxed at the Mecklenburg County rate plus Charlotte's city rate. A purchase in a rural area with no city tax is just the state rate plus the county rate.
To find the exact rate where you shop, you need to know both the county and the city. The North Carolina Department of Revenue publishes a complete list of all county and city rates, updated when changes occur. Your receipt will show the total tax charged.
What items are exempt from sales tax
Not everything you buy in North Carolina is subject to sales tax. Groceries — food you prepare at home — are exempt. This includes meat, produce, dairy, bread, and canned goods. However, prepared foods, restaurant meals, and items like candy and soft drinks are taxed.
Prescription medications are also exempt from sales tax. Over-the-counter medicines like aspirin or cold medicine are taxed, but anything requiring a prescription is not. Medical equipment prescribed by a doctor, such as wheelchairs or diabetic supplies, may be exempt depending on the specific item.
Clothing is taxed in North Carolina, as are most household goods, electronics, and services. If you are unsure whether a specific item is taxed, the retailer's receipt will show whether tax was charged.
Sales tax on online and mail orders
Online retailers are required to charge North Carolina sales tax on orders shipped to addresses in the state. This applies whether you order from a large national company or a small online seller. The tax rate is based on the delivery address, not where the seller is located.
If a retailer does not charge tax at checkout, you may owe use tax on that purchase when you file your North Carolina income tax return. Use tax is the state's way of collecting tax on untaxed purchases. In practice, most people do not report this, but the law requires it.
Sales tax on services and labor
Most services in North Carolina are not subject to sales tax. If you hire a plumber, electrician, or contractor, labor charges are generally not taxed. However, if the service includes selling you a product — such as a plumber selling you a new water heater — the product itself is taxed.
Some services are taxed. Haircuts and salon services are subject to sales tax. Repairs to tangible items like shoes or appliances are usually taxed. The rule is complex and depends on whether the service is considered a repair, maintenance, or installation of a product.
Finding the exact tax rate for your location
The North Carolina Department of Revenue maintains an official list of all county and city sales tax rates. You can search by county name or city to find the combined rate. Rates change occasionally when counties or cities adjust their local taxes, so checking the official source is more reliable than using an older rate you remember.
Your receipt will always show the exact rate charged. If you are making a large purchase and want to know the tax in advance, ask the retailer or look up your location on the Department of Revenue website. Most retailers' websites also have a tax calculator where you can enter your zip code.
Frequently Asked Questions
Is North Carolina's sales tax higher or lower than neighboring states?
North Carolina's combined rate varies by location but typically falls between 6.75 and 7.75 percent. South Carolina has a 7.5 percent state rate with no local additions, making it higher in most places. Virginia's state rate is 5.3 percent with local additions up to 2.3 percent, resulting in rates similar to or slightly lower than North Carolina depending on the city.
Do I pay sales tax on used items or secondhand purchases?
Sales tax applies to used items sold by retailers, including used cars, used furniture, and used electronics. Private sales between individuals are generally not taxed. If you buy a used item from a business or reseller, tax is charged based on the sale price.
What about sales tax on vehicle purchases?
North Carolina charges sales tax on vehicle purchases at the rate for the county where the vehicle is registered, not where you buy it. The tax is calculated on the sale price and is typically collected by the dealer or paid when you register the vehicle with the DMV.
Are there any temporary sales tax holidays in North Carolina?
North Carolina does not have a regular statewide sales tax holiday. Some counties or cities may offer temporary tax breaks for specific items or events, but these are not common. Check with your local government if you think a holiday might apply to your purchase.