Texas charges 6.25% state sales tax, plus local taxes that range from 0% to 2%
The state sales tax rate in Texas is 6.25%. This is the baseline tax you pay on most purchases. On top of that, your city or county may add a local sales tax of 0.5% to 2%, depending on where you live. Your total sales tax rate — what you actually see on your receipt — is the combination of state plus local.
For example, if you buy something in Austin, you pay 6.25% state tax plus 2% local tax, for a total of 8.25%. In Houston, the rate is 8.25% as well. In some smaller towns, the local portion may be just 0.5%, bringing your total to 6.75%. The state rate never changes, but the local rate depends on your location.
Key Takeaways
- Texas state sales tax is always 6.25%, but your total rate depends on local taxes added by your city or county.
- Local sales tax ranges from 0% to 2%, so your total rate can be anywhere from 6.25% to 8.25%.
- The tax rate that applies is determined by where the sale takes place, not where you live or where the business is based.
- Sales tax applies to most goods and some services, but groceries, prescription medicines, and certain other items are exempt.
How to find your exact local sales tax rate
Your exact rate depends on your city and county. The easiest way to find it is to look at a recent receipt from a store in your area — the tax rate is printed on it. You can also search online for "[your city] sales tax rate" or call your city's tax assessor's office.
The Texas Comptroller of Public Accounts maintains a database of all local tax rates by location. You can search by zip code or city name on their website to see the exact breakdown of state and local tax for your area. This is useful if you are moving or want to know the rate in a different part of Texas.
What items are taxed and what are not
Most goods — clothing, electronics, furniture, household items — are subject to sales tax. However, some items are exempt, meaning you do not pay tax on them. Groceries (unprepared food you cook at home) are not taxed. Prescription medicines are not taxed. Over-the-counter medicines like aspirin or cold medicine are taxed.
Restaurant meals and prepared food are taxed. Gasoline is taxed. Utilities like electricity and water are taxed. Services vary: haircuts are taxed, but medical services are generally not. If you are unsure whether something is taxed, ask the cashier or check your receipt after purchase.
Sales tax on online and out-of-state purchases
If you order something online from a seller outside Texas, you may not see sales tax added at checkout. However, Texas law requires you to pay use tax on those purchases — it is the same rate as sales tax, just collected differently. Most people do not pay use tax voluntarily; it is meant to be reported on your state tax return.
If you order from an online retailer that has a physical presence in Texas (like Amazon or Walmart), they collect sales tax at checkout, just as a store would. The tax rate applied is based on the address where the item is being shipped.
How sales tax is used
Sales tax revenue goes to state and local governments. The state keeps the 6.25% portion; cities and counties keep their local portion. The money funds schools, roads, police, fire departments, libraries, and other public services. Texas has no state income tax, so sales tax is a major source of funding for state operations.
Local tax rates vary because different cities and counties have different needs and spending priorities. A city that recently built a new school or road may have a higher local sales tax rate than a smaller town with fewer infrastructure projects.
Sales tax on specific purchases
| Item or Service | Taxed? | Notes |
|---|---|---|
| Groceries (unprepared food) | No | Bread, milk, vegetables, meat you cook at home are not taxed |
| Restaurant meals | Yes | Food prepared and served to you is taxed |
| Prescription medicines | No | Requires a valid prescription |
| Over-the-counter medicines | Yes | Aspirin, cold medicine, vitamins are taxed |
| Clothing and shoes | Yes | All apparel is taxed |
| Gasoline | Yes | State and local sales tax applies |
| Haircuts and salon services | Yes | Personal services are taxed |
| Medical services | No | Doctor visits, surgery, therapy are not taxed |
Frequently Asked Questions
Does Texas have different sales tax rates for different cities?
Yes. The state rate is always 6.25%, but cities and counties add their own local tax on top of that. Your total rate depends on your location. Two cities just a few miles apart can have different total rates.
Is sales tax included in the price shown on the shelf?
No. The price on the shelf or tag is the pre-tax price. Sales tax is added at the register. This is why your receipt total is higher than the price you saw.
Do I pay sales tax if I buy something in one Texas city and take it home to another?
Yes. The tax rate that applies is based on where the sale takes place — where you buy it, not where you live. If you buy something in Austin and take it home to Dallas, you pay Austin's rate.
What is use tax and do I have to pay it?
Use tax is a tax on items you buy outside Texas or online without paying sales tax. It is the same rate as sales tax. Legally you owe it, but it is rarely enforced for individual purchases. It is meant to be reported on your state tax return.
Can I get a sales tax refund if I return something?
Yes. When you return an item and get a refund, the sales tax is refunded as well. The refund appears on your receipt or credit card statement.