Oregon has no statewide sales tax

Oregon does not charge a sales tax on most purchases. You will not pay a percentage of the purchase price at checkout for clothing, groceries, electronics, or most other goods. This applies statewide — no county or city in Oregon adds a local sales tax either.

The main exception is restaurant meals and prepared food. Oregon taxes these at the state rate of 9%, regardless of where you eat in the state. A coffee from a café, a sandwich from a deli counter, or a full restaurant meal all trigger the tax. Groceries you buy raw and cook at home do not.

A second exception is lodging. Hotels, motels, and short-term rentals are taxed at rates that vary by county — typically between 9% and 12%. Some cities add an additional local tax on top of the state rate.

Key Takeaways

  • Oregon charges no sales tax on clothing, groceries, household goods, or most retail purchases.
  • Restaurant meals and prepared foods are taxed at 9% statewide, but raw groceries are not.
  • Hotel and short-term rental stays are taxed at rates between 9% and 12% depending on the county.
  • No Oregon county or city adds a local sales tax on top of state rates.

What counts as prepared food and gets taxed

Oregon's definition of prepared food is broader than just sit-down restaurants. Any food that has been cooked, heated, or assembled for immediate consumption is taxed. This includes deli items, bakery items sold hot, rotisserie chicken, pizza, sushi, smoothies, and food from food carts.

The key word is prepared. A loaf of bread from a grocery store bakery shelf is not taxed. A hot bagel from the same bakery is. Raw ingredients — flour, eggs, vegetables, meat from the butcher counter — are never taxed, even if you buy them at a restaurant supply store or specialty market.

Alcohol is handled separately. Beer, wine, and spirits are subject to Oregon's liquor tax, which is different from the prepared food tax. The liquor tax rate varies by type of alcohol and is applied at the point of sale.

Lodging tax rates by county

Oregon's lodging tax is set by county, so the rate depends on where you stay. Most counties charge between 9% and 12%. Some of the largest cities — Portland, Eugene, Salem — add a city tax on top of the county rate, which can push the total to 14% or higher.

Lodging tax applies to hotels, motels, bed-and-breakfasts, vacation rentals, and any accommodation rented for fewer than 30 consecutive days. If you rent an apartment or house for 30 days or longer, the lodging tax does not apply — you may owe income tax instead, depending on your situation, but that is a different matter.

The tax is usually added to your bill at checkout or included in the final price shown when you book online. Ask the hotel or rental host if you are unsure whether the price shown includes tax.

Why Oregon has no sales tax

Oregon voters have rejected sales tax proposals multiple times since the 1930s. The state instead funds schools, roads, and services through income tax, which is higher than in many other states. Oregon's top income tax rate is 9.9%, one of the highest in the nation.

This trade-off means Oregon residents pay more in income tax but less at the register. Visitors and tourists, who do not pay Oregon income tax, benefit from the lack of sales tax on most goods — though they do pay lodging tax and prepared food tax.

How to know if something is taxed

The simplest rule: if you are buying raw ingredients or goods to take home and use later, there is no tax. If you are buying food to eat right away or a place to sleep tonight, there probably is tax.

When in doubt, ask the cashier or the business before you pay. Restaurants and hotels are required to disclose the tax rate, and most will tell you the total including tax before you complete the purchase. Online retailers based in Oregon may or may not charge tax depending on the item — if you see tax added to a clothing purchase, contact the seller to ask why.

Frequently Asked Questions

Do I pay sales tax on clothes and shoes in Oregon?

No. Clothing and shoes are not taxed in Oregon, regardless of price or type. This applies to new and used clothing sold in stores, online, or at secondhand shops.

Is tax included in the price shown at Oregon stores?

No. For prepared food and lodging, the price shown is before tax. The tax is added at checkout. For all other goods, there is no tax to add, so the price you see is what you pay.

What if I buy something online from an Oregon company?

If the item is not prepared food or lodging, you will not pay Oregon sales tax. If you live outside Oregon and the online seller is based there, you may owe sales tax in your own state depending on your state's rules — but that is your state's tax, not Oregon's.

Do grocery stores charge tax on anything?

Most items in a grocery store are not taxed. However, hot foods from the deli, prepared salads, rotisserie chicken, and items from the hot case are taxed at 9%. Cold items from the cooler are not. Ask the cashier if you are unsure.

Is there a local sales tax in Portland or other cities?

Portland and other Oregon cities do not add a local sales tax on retail goods. They do add a local lodging tax on top of the state rate, so a hotel stay in Portland will be taxed higher than in a rural county.