Texas charges sales tax at the point of sale, and the rate depends on where you buy

Texas has a state sales tax of 6.25 percent. When you buy something in a store or online, you pay that 6.25 percent on top of the price. Most cities and counties add their own local sales tax on top of the state rate, so your total can range from 6.25 percent to 8.25 percent depending on your location.

The tax is collected by the business at the register or checkout. You do not send it to the state yourself — the store collects it from you and sends it to the Texas Comptroller of Public Accounts, which is the state agency that manages tax revenue.

Not everything is taxed. Groceries, prescription medications, and certain medical devices are exempt. Clothing and shoes are also exempt in Texas. But restaurant meals, prepared foods, and non-prescription items are taxed at the full rate.

Key Takeaways

  • Texas state sales tax is 6.25 percent, but your actual rate is higher because cities and counties add local taxes on top.
  • The tax is added at checkout — you do not calculate or pay it separately.
  • Groceries and prescription medications are not taxed, but restaurant meals and prepared foods are.
  • Your total sales tax rate depends on your city and county, so it varies by location within Texas.

How local taxes stack on top of the state rate

Cities can add up to 2 percent in local sales tax. Counties can add up to 1 percent. Some cities and counties add both, which means you could pay as much as 9.25 percent total — though the state caps the combined rate at 8.25 percent in most places.

Austin, for example, has a combined rate of 8.25 percent (6.25 state plus 2 percent local). Houston is 8.25 percent. Dallas is 8.25 percent. San Antonio is 8.125 percent. Rural areas with no local additions stay at 6.25 percent.

You can find your exact rate by entering your address on the Texas Comptroller website, or by asking a cashier. The rate is the same whether you shop in person or online — the seller is required to charge the rate for your location, not theirs.

What is and is not taxed in Texas

Exempt items (no tax):

  • Groceries and food you cook at home
  • Prescription medications
  • Medical devices prescribed by a doctor
  • Clothing and shoes
  • Diapers

Taxed items (full rate applies):

  • Restaurant meals and takeout food
  • Prepared foods from grocery store delis
  • Non-prescription medicines and vitamins
  • Household supplies and cleaning products
  • Electronics and appliances
  • Gas and fuel

The line between grocery and prepared food matters. A rotisserie chicken from the grocery store deli is taxed. A raw chicken from the meat counter is not. A sandwich made in the store is taxed. Sandwich ingredients you buy separately are not.

How sales tax works for online and out-of-state purchases

If you order something online from a Texas seller, Texas sales tax applies based on your delivery address. If you order from an out-of-state seller, the seller is required to collect Texas sales tax if they have a physical presence in Texas or if they meet certain sales thresholds set by federal law.

Many large online retailers (Amazon, Walmart, Target) collect Texas sales tax on all orders shipped to Texas addresses, even if the company is based elsewhere. Smaller sellers may not, which means you might not see tax added at checkout. You are not responsible for tracking this down — the seller is responsible for collecting and remitting the tax.

If you buy something in person while traveling outside Texas and bring it back, you do not owe Texas sales tax on it. Texas does not have a use tax for personal purchases brought into the state.

Who collects and where the money goes

The business you buy from collects the tax and holds it temporarily. They send it to the Texas Comptroller of Public Accounts, usually monthly. The Comptroller then distributes the money to the state general fund and to local governments based on where the sale occurred.

Cities and counties use their portion for schools, roads, emergency services, and other local programs. The state uses its portion for education, healthcare, and state operations. You do not file anything related to sales tax as a consumer — the system is entirely between the business and the state.

Sales tax on specific situations

Shipping and delivery: If you pay for shipping separately, it is usually taxed. If shipping is included in the price, the entire amount is taxed.

Trade-ins: If you trade in an old item toward a new purchase, you only pay tax on the difference. If you trade in a car worth $5,000 toward a $15,000 car, you pay tax only on the $10,000 difference.

Gifts and returns: Gifts are taxed when you buy them, not when you give them. If you return something, you get a refund of the tax you paid.

Resale: If you buy something to resell (you are a business), you can provide a resale certificate to avoid paying sales tax. You collect tax from your customers instead.

Frequently Asked Questions

Why is my receipt showing a different tax rate than I expected?

Your location determines the rate, not the store. If you bought something in a different city or county than where you live, that location's rate applies. You can check your exact rate by entering your address on the Texas Comptroller website or asking the store.

Do I have to pay sales tax on used items?

Yes, used items are taxed the same way as new ones when you buy them from a business. If you buy from an individual (a private sale), sales tax does not apply — only business-to-consumer sales are taxed.

Is sales tax included in the price or added at checkout?

In Texas, the price shown is before tax. Sales tax is added at checkout. This is different from some states where the displayed price includes tax.

What happens if a business does not charge me sales tax?

That is the business's error and their responsibility to fix, not yours. You are not required to report it or pay the tax separately. The business is responsible for collecting and remitting all sales tax owed.

Can I get a refund of sales tax I paid?

Only if you return the item. If you return something within the store's return window, you get back the full amount including tax. You cannot get a refund of sales tax on items you keep.