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Collecting sales tax is an essential part of doing business, but New York City’s nuanced tax code can make it confusing. Not sure how much to charge your customers? Our simple calculator is here to help. Just enter the total purchase amount, and we’ll automatically calculate the sales tax at the city’s combined rate.
The sales tax rate in New York City is 8.875%1, which includes a 4.5% city tax, a 4% New York State tax, and a 0.375% Metropolitan Commuter Transportation District (MCTD) surcharge. This rate applies to most goods and services, though certain items, such as clothing under $110, are exempt from the combined tax. Parking, garaging, or storing motor vehicles in Manhattan is subject to a 10.375% sales tax and an additional 8% surtax.
To calculate sales tax in New York City, you need to know the purchase amount and the applicable sales tax rate, which can vary depending on the item and its taxability.
Start by multiplying the purchase amount by the combined tax rate to find the sales tax. Then, add the sales tax to the original purchase amount to get the total cost.
To calculate sales tax:
Multiply the Purchase Amount by the applicable Sales Tax Rate to get the Sales Tax amount
Add the Sales Tax to the original Purchase Amount to find the Total Cost
You can use these formulas or use our calculator for a faster answer.
Sales Tax = Purchase Amount × Sales Tax Rate
Total Cost = Purchase Amount + Sales Tax
Remember to include New York State sales tax as part of the combined sales tax rate when calculating sales tax in New York City. Both the city and the state impose taxes on most goods, and the state tax is a significant part of the total amount owed.
Like many municipalities, New York City exempts some items from sales tax to lessen the financial burden on consumers. Items2 exempt from sales tax in New York City include:
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Items sold for less than $110 per item or pair are tax-exempt.
Most unprepared grocery items are exempt, though alcohol and soda are taxable.
Medications prescribed by licensed healthcare professionals and certain medical devices are not taxed. Feminine hygiene products are also exempt.
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Residential gas, electricity and heating fuels like oil are exempt from sales tax.
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Newspapers and periodicals, including digital subscriptions, are tax-exempt to encourage access to information.
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Residents of Manhattan are eligible to apply to an exemption to the 8% surtax on parking, garaging, or storing a vehicle in Manhattan3.
1New York Department of Finance: New York State sales and use tax
2NYC 311: Sales Tax
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1 New York Department of Finance: New York State sales and use tax
2 New York Department of Finance: Manhattan Resident Parking Tax Exemption
2 NYC 311: Sales Tax
