Sales Tax Calculator (Add or Remove Tax)
Work out sales tax two ways: add a tax rate on top of a pre-tax price, or start from a tax-included total (like a receipt) and back out exactly how much of it was tax.
How this calculation works
Adding tax: tax = price × (rate ÷ 100), and the total you pay is price + tax. A 100 item at an 8% rate adds 8 of tax for a 108 total.
Removing tax: if a total already includes tax, dividing straight by the rate over-corrects, because the rate applies to the pre-tax price, not the total. The correct pre-tax price is total ÷ (1 + rate ÷ 100); the tax itself is total minus that pre-tax price.
Both directions use the same rate, just applied in opposite order — one multiplies a smaller base up, the other divides a larger total down.
Worked example
Adding tax vs. backing tax out
These are inverse operations, not the same formula run backwards with a minus sign. Adding tax scales a known pre-tax price up: total = price × (1 + rate ÷ 100). Backing tax out scales a known tax-included total down to find the price hidden inside it: price = total ÷ (1 + rate ÷ 100). The tax amount is always the difference between the two — never the total multiplied directly by the rate.
VAT/GST vs. US-style sales tax
The underlying arithmetic is the same everywhere; what differs is which price you see first.
| US-style sales tax | VAT / GST-style | |
|---|---|---|
| Displayed price | Tax-exclusive (tax added at checkout) | Tax-inclusive (tax already in the price) |
| Typical mode here | Add tax | Remove tax |
| Who sees the tax broken out | Buyer, on the receipt | Buyer, only if itemized |
| Common range | 0–10%+, varies by state/city | 5–27%, set nationally |
Reading tax off a receipt
A typical receipt lists subtotal, tax, and total as three separate lines — the subtotal is the pre-tax price, tax is the amount collected, and total is what you paid, so subtotal + tax = total. If you only have the total and the tax rate (common with a tax-inclusive VAT/GST price, or a lump-sum invoice), use "remove tax" mode to recover the subtotal and tax split rather than guessing by eye.
When an order mixes items taxed at different rates (some regions exempt groceries or apply a reduced rate to certain goods), calculate each taxed group separately and add the results — a single blended rate across the whole order will not match the receipt exactly.