Texas charges a base sales tax of 6.25 percent on most goods and services

Texas has no state income tax, so the state relies on sales tax to fund schools, roads, and other services. When you buy something in Texas, you pay 6.25 percent of the purchase price to the state. This is the state sales tax rate, and it applies statewide.

However, the total tax you pay at checkout is usually higher than 6.25 percent. Cities and counties in Texas can add their own local sales taxes on top of the state rate. Your final tax bill depends on where you live or where you make the purchase.

Some items are taxed differently or not taxed at all. Food you cook at home, prescription medicines, and certain medical equipment are exempt from sales tax. 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 total tax rate includes local additions that vary by city and county.
  • Combined sales tax rates in Texas range from 6.25 percent to over 8 percent depending on your location.
  • Groceries and prescription medicines are not taxed, but restaurant meals and prepared foods are taxed at the full rate.
  • You can find your exact local sales tax rate by entering your address on the Texas Comptroller's website or asking a retailer.

How local taxes add to the state rate

Texas allows cities and counties to impose additional sales taxes on top of the 6.25 percent state rate. A city might add 1 percent, and a county might add another 0.5 percent. When you buy something in that location, you pay all three: state, city, and county tax combined.

This means your actual sales tax rate depends entirely on where you are. In some areas, the combined rate is 6.25 percent (state only, with no local additions). In others, it can reach 8.25 percent or higher. A purchase that costs $100 might have $6.25 in tax in one location and $8.25 in another.

Local taxes fund schools, public transportation, and city services. When you move to a new city or county in Texas, your sales tax rate changes when ready. Online purchases are trickier—the tax rate usually depends on where the seller is located or where the item ships to.

What is and is not taxed in Texas

Not everything you buy is subject to sales tax. Groceries—food you prepare at home like bread, milk, vegetables, and meat—are not taxed. Prescription medicines filled by a pharmacist are also exempt. Medical devices prescribed by a doctor, like diabetic test strips or hearing aids, are not taxed.

Items that are taxed include restaurant meals, fast food, coffee shops, and any prepared or ready-to-eat food. Candy, soft drinks, and snack foods are taxed. Over-the-counter medicines like pain relievers and cold medicine are taxed because they are not prescribed.

Services are generally not taxed in Texas, with some exceptions. Haircuts, car repairs, and plumbing work are not subject to sales tax. However, some services bundled with goods—like installation of carpet or appliances—may be taxed depending on how the seller reports it.

Finding your exact local sales tax rate

The Texas Comptroller of Public Accounts maintains a searchable database of sales tax rates by location. You can visit the Comptroller's website and enter your street address or zip code to see your exact combined rate. This tool shows you the state rate plus all local additions for your specific area.

You can also call a local business or retailer and ask what they charge. Most stores display the combined rate on their receipts. If you are moving to a new city or county, checking the rate before you move helps you budget for the change.

Sales tax rates change when cities or counties vote to raise or lower their local rate. These changes are usually announced in advance, but the Comptroller's database is updated regularly, so it is the most reliable source.

How sales tax is collected and reported

Retailers collect sales tax from customers at the point of sale and send it to the state. The store is responsible for calculating the correct rate based on the location of the sale and remitting the money to the Texas Comptroller. Most retailers use point-of-sale systems that automatically calculate the right rate.

Businesses file sales tax reports monthly or quarterly, depending on how much tax they collect. Small businesses might file once a year. The Comptroller uses this money to fund the state budget, and local portions go to cities and counties.

If you own a business in Texas, you need a sales tax permit from the Comptroller before you can collect tax from customers. The permit is free, and you can register online through the Comptroller's website.

Sales tax on online and out-of-state purchases

When you order something online from a Texas retailer, you typically pay the sales tax rate of the location where the item ships. If you order from a company outside Texas, the rules are more complex. Large online retailers like Amazon now collect Texas sales tax on most items, but smaller sellers may not.

If you buy something from an out-of-state seller and no sales tax was collected, you may owe use tax to Texas. Use tax is a backup tax that applies when sales tax was not paid. Most people do not report use tax on individual purchases, but it is technically owed. Businesses are more likely to be audited for unpaid use tax than individuals.

The safest approach is to assume that major retailers will collect the tax for you. If you are unsure whether tax was charged, check your receipt or contact the seller.

Frequently Asked Questions

Does Texas have sales tax on clothing?

Yes. Clothing is taxed at the full state and local rate in Texas. There is no clothing exemption. A shirt, pants, or shoes you buy in a store are subject to the combined sales tax rate of that location.

What is the difference between sales tax and use tax?

Sales tax is collected by the seller when you buy something. Use tax is a backup tax you owe to Texas if you buy something outside the state and no sales tax was charged. For example, if you buy an item from an out-of-state seller with no tax, you technically owe use tax to Texas, though it is rarely enforced for individual purchases.

Can I get a refund of sales tax I already paid?

No. Sales tax is final once you pay it. If you return an item, the store refunds the purchase price and the tax together. If you paid tax on something that should have been exempt, you would need to contact the store or the Texas Comptroller to dispute it, which is uncommon.

Do I pay sales tax on services like haircuts or car repairs?

Most services in Texas are not taxed. Haircuts, car repairs, plumbing, and similar work are not subject to sales tax. However, if the service includes a product—like a haircut plus a shampoo product—the product portion may be taxed separately.

What happens if a store charges the wrong sales tax?

If you notice a store charged the wrong rate, you can ask them to correct it on the spot. Keep your receipt. If the error is significant, you can contact the Texas Comptroller's office with your receipt and the store's information. The Comptroller investigates complaints about incorrect tax collection.