Tennessee's statewide sales tax is 9.55 percent

Tennessee has one of the highest sales tax rates in the country. The state charges 9.55 percent on most purchases, made up of a 4 percent state tax plus local taxes that vary by county and city. What you actually pay depends on where you shop — a purchase in Nashville costs a different rate than the same purchase in Memphis or Knoxville.

The 9.55 percent figure is the statewide average. Your actual rate is higher or lower based on your location. Counties add their own tax on top of the state rate, and some cities add an additional layer. When you see a price tag, the tax shown at checkout reflects all three: state, county, and city combined.

Key Takeaways

  • Tennessee's state sales tax is 4 percent, but the total rate you pay ranges from 8.25 percent to 9.75 percent depending on your county and city.
  • The statewide average of 9.55 percent includes state tax plus the most common local tax combinations across the state.
  • Groceries, prescription medications, and medical equipment are generally exempt from sales tax in Tennessee.
  • Your receipt shows the exact tax rate applied to that transaction at that location.

How local taxes add to the state rate

Tennessee's 4 percent state sales tax is just the starting point. Every county in Tennessee adds a local tax on top of it. Most counties charge between 2.25 percent and 2.75 percent in local tax, which brings the combined rate to somewhere between 6.25 percent and 6.75 percent before any city tax is added.

Some cities then add a third layer. Nashville adds 2.25 percent on top of the state and county rates, making the total 8.75 percent. Memphis adds 1.5 percent, bringing its total to 9.25 percent. Knoxville adds 2.75 percent, reaching 9.25 percent. Smaller cities may add nothing, or may add a small amount for local services. The result is that two purchases made on the same day in different Tennessee cities will have different tax rates applied.

What items are not taxed

Tennessee exempts certain items from sales tax entirely. Groceries — food you buy to cook at home — are not taxed. This includes meat, produce, dairy, bread, and canned goods. Restaurant meals and prepared food are taxed normally. Prescription medications are not taxed. Over-the-counter medications like aspirin or cold medicine are taxed.

Medical equipment and supplies used to treat a specific condition are generally exempt. This includes items like diabetic test strips, hearing aids, and mobility devices. Clothing is taxed in Tennessee, including shoes and accessories. Children's clothing is not exempt — the state taxes it the same as adult clothing.

Finding your exact local rate

The easiest way to find your exact sales tax rate is to look at a recent receipt from a store in your area. The rate printed on the receipt is the combined state, county, and city rate for that location. If you do not have a receipt, you can call your county assessor's office or city clerk's office and ask for the current combined rate.

Tennessee's Department of Revenue publishes a list of all county and city rates on its website. You can search by county name to see the state rate, the county rate, and any city rates that apply. Keep in mind that rates can change, though they do not change frequently. If you are planning a large purchase, checking the current rate for your location takes less than five minutes.

How sales tax is collected and used

When you pay sales tax at checkout, the store collects it and sends it to the state. The state keeps the 4 percent state portion and distributes the local portion to the county and city where the purchase was made. Counties use their portion for schools, roads, and county services. Cities use their portion for police, fire, and city infrastructure.

Online purchases made from out-of-state sellers have historically not been taxed in Tennessee, though this has changed in recent years. Many large online retailers now collect Tennessee sales tax on orders shipped to Tennessee addresses, even if the retailer is based elsewhere. The rules for online sales tax are complex and still changing, so if you have questions about a specific online purchase, contact the retailer directly.

Comparing Tennessee to other states

Tennessee's average rate of 9.55 percent ranks among the highest in the nation. Only a handful of states have higher combined rates. States like Louisiana, Arkansas, and Alabama have similar or slightly higher average rates. States like Colorado, Wyoming, and New Hampshire have significantly lower rates or no sales tax at all.

What matters most is not how Tennessee compares nationally, but what you pay locally. If you live in a county with a lower local tax rate, your combined rate may be closer to 8.5 percent. If you live in a county with a higher local rate, it may be closer to 9.75 percent. The difference between counties in Tennessee can be as much as 1.5 percentage points, which adds up on large purchases.

Frequently Asked Questions

Do I pay sales tax on groceries in Tennessee?

No. Food you buy to prepare at home — produce, meat, dairy, bread, canned goods — is not taxed. Restaurant meals, prepared foods, and food eaten on premises are taxed normally. If you are unsure whether a specific item counts as groceries, ask the cashier before checkout.

Why is my sales tax different from the statewide average?

The 9.55 percent average reflects the most common combination of state, county, and city rates across Tennessee. Your actual rate depends on your specific county and city. If you live in a county with lower local rates or a city that does not add tax, your rate will be lower than the average.

Do I have to pay sales tax on clothing?

Yes. Tennessee taxes all clothing, including children's clothing and shoes. Some states exempt children's clothing, but Tennessee does not. Accessories like belts, hats, and bags are also taxed.

Is prescription medication taxed in Tennessee?

No. Prescription medications are exempt from sales tax. Over-the-counter medications like pain relievers, cold medicine, and allergy medicine are taxed normally. Your pharmacist can tell you which items in your purchase are taxed and which are not.

What if I buy something online from an out-of-state seller?

Many large online retailers now collect Tennessee sales tax on orders shipped to Tennessee addresses. Smaller retailers may not. If tax was not collected at checkout, Tennessee law may require you to pay use tax on the purchase, though this is rarely enforced for individual consumers. Check your receipt or contact the retailer if you are unsure.