California has the highest state sales tax rate at 7.25 percent
California's base state sales tax is 7.25 percent, the highest in the country. However, the total tax you pay at checkout is usually higher because counties and cities add their own local sales taxes on top of the state rate. In some California cities, the combined rate reaches 10.5 percent or more.
Tennessee, Louisiana, Arkansas, and Alabama also have state rates of 7 percent or higher. But the final number you see on your receipt depends on where you shop — your city and county can add 1 to 3 percent more. This means a state with a lower base rate might have a higher total tax in certain cities.
Key Takeaways
- California's state sales tax of 7.25 percent is the highest in the nation, though local taxes often push the total higher.
- The tax you actually pay includes both state and local rates, so two cities in the same state can have different totals.
- Tennessee, Louisiana, Arkansas, and Alabama also rank among the highest-tax states at 7 percent or above.
- Five states — Alaska, Delaware, Montana, New Hampshire, and Oregon — have no state sales tax at all.
How state and local sales taxes combine
Your receipt shows a combined rate because state and local governments both collect sales tax. The state sets a base rate, then your county or city adds its own percentage on top. A store in Los Angeles might charge 9.5 percent total (7.25 state plus 2.25 local), while a store 30 miles away in a different county might charge 8.25 percent.
This layering means you cannot assume the highest state rate produces the highest checkout price. Some cities in lower-tax states add substantial local taxes, while some cities in high-tax states keep local rates low. The only way to know the exact rate for your location is to check your city or county's tax authority website or ask a retailer.
States with sales tax rates of 7 percent or higher
| State | State Sales Tax Rate |
|---|---|
| California | 7.25% |
| Tennessee | 7.0% |
| Louisiana | 7.0% |
| Arkansas | 7.0% |
| Alabama | 7.0% |
These five states have the highest state-level sales tax rates. However, the total tax you pay will be higher in most locations because counties and cities layer on additional percentages. Tennessee and Louisiana, for example, allow local governments to add up to 2.75 percent in some areas, bringing combined rates to nearly 10 percent.
When you shop in these states, the final amount you owe depends entirely on your specific city and county. Two people buying the same item in the same state can pay different tax amounts if they live in different jurisdictions. This is why checking your local rate before making a large purchase can matter.
States with no sales tax
Five states do not collect sales tax at all: Alaska, Delaware, Montana, New Hampshire, and Oregon. This does not mean residents pay no tax on purchases — some of these states use other taxes instead, like income tax or property tax. Alaska, for instance, has no state income tax or sales tax, but some cities and boroughs charge local sales taxes.
If you live in or move to one of these states, you will not see sales tax added to most purchases. However, if you buy something online from an out-of-state retailer, that retailer may still charge sales tax based on your shipping address, depending on their policies and state law.
Why sales tax rates vary so much between states
States set sales tax rates based on their own revenue needs and tax policy choices. Some states rely heavily on sales tax to fund schools, roads, and services. Others prefer income tax or property tax and keep sales tax low or nonexistent. These choices reflect each state's history, economy, and political priorities.
Local governments also have different needs. A city with high costs for schools or infrastructure may add a larger local sales tax. A wealthier county might keep local rates low. Over time, these decisions create the patchwork of rates you see across the country.
How to find the sales tax rate for your location
Your city or county tax assessor's office publishes the current combined sales tax rate for your area. You can find this information on your city or county government website, usually under "Finance," "Tax Assessor," or "Revenue." Many states also maintain a searchable database of all local tax rates by ZIP code.
If you are shopping online, the retailer will calculate the tax based on your shipping address at checkout. If you are shopping in person and want to know the exact rate before you buy, ask the cashier or check the store's receipt. The rate may differ slightly from city to city, so if you shop near a city border, the tax could change depending on which side you are on.
Frequently Asked Questions
Do I pay sales tax on groceries?
It depends on your state. Most states exempt unprepared groceries from sales tax, but some tax them fully or partially. A few states tax prepared foods but not raw ingredients. Check your state's tax authority website or ask your grocer to confirm what is taxed in your area.
Is sales tax the same everywhere in California?
No. California's state rate is 7.25 percent, but counties and cities add local taxes that range from 0.1 to 2.25 percent. Some areas have combined rates as high as 10.5 percent, while others are closer to 8 percent. Your exact rate depends on your city and county.
Do online purchases have sales tax?
Most online retailers now collect sales tax based on your shipping address, even if they have no physical store in your state. However, some smaller sellers may not collect it. If tax was not charged, you may owe it when you file your state tax return, though enforcement varies by state.
Can I avoid sales tax by shopping in a no-tax state?
Not reliably. If you live in a state with sales tax and buy something in a no-tax state, your home state may require you to pay tax on that purchase when you return. Additionally, most online retailers now charge tax based on your shipping address, regardless of where the seller is located.