Philadelphia's Combined Sales Tax Rate

Philadelphia charges 8.0% sales tax on most purchases. This rate combines the Pennsylvania state sales tax of 6% with the Philadelphia city sales tax of 2%. When you buy something in Philadelphia, the seller adds 8 cents to every dollar of the purchase price.

The 2% city portion applies only within Philadelphia's city limits. If you buy the same item in a nearby suburb like Cheltenham or Bensalem, you pay only the 6% state tax. The difference matters most on large purchases — a $500 item costs $40 in tax in Philadelphia but $30 in the surrounding county.

Pennsylvania does not have a local sales tax outside Philadelphia, so the city rate is unique in the state. Other Pennsylvania cities cannot add their own sales tax on top of the state rate.

Key Takeaways

  • Philadelphia's total sales tax is 8.0%, made up of 6% state tax and 2% city tax.
  • The 2% city tax applies only to purchases made within Philadelphia's city boundaries.
  • Groceries, prescription medications, and clothing under $110 are exempt from sales tax in Pennsylvania.
  • Restaurant meals and prepared foods are taxed at the full 8.0% rate in Philadelphia.
  • Online purchases from out-of-state sellers may not include Philadelphia sales tax, depending on the seller's location and the item type.

What Items Are Exempt From Sales Tax

Pennsylvania exempts certain everyday items from sales tax statewide, including Philadelphia. Groceries — unprepared food you cook at home — are not taxed. This includes bread, milk, vegetables, meat, and canned goods. The exemption does not cover restaurant meals, prepared deli foods, or items from a hot food bar.

Prescription medications are also exempt. Over-the-counter drugs like aspirin or cold medicine are taxed, but anything requiring a prescription from a doctor is not. Clothing and footwear under $110 per item are exempt as well. A $100 shirt is tax-free, but a $150 coat is taxed on the full amount.

Medical equipment such as wheelchairs, crutches, and hearing aids are exempt. Diapers and incontinence products are also not taxed. These exemptions explore the same way across Philadelphia and the rest of Pennsylvania.

When You Pay Sales Tax on Food and Drink

The line between taxed and untaxed food is strict. If a restaurant or deli prepares the food, you pay 8.0% tax on it. This includes sandwiches from a deli counter, hot pizza, rotisserie chicken, salad bar items, and anything from a food truck. Coffee and beverages are taxed whether they are hot or cold.

Grocery store items you prepare yourself are not taxed, even if you buy them from the same store. Raw chicken is tax-free; rotisserie chicken from the store's hot case is taxed. Uncooked pasta is tax-free; a prepared pasta salad is taxed. The difference is whether the store or a restaurant prepared it.

Alcohol is taxed at the full 8.0% rate in Philadelphia. Beer, wine, and spirits all carry the sales tax when you buy them at a store or bar.

Sales Tax on Services and Digital Purchases

Most services are not subject to Pennsylvania sales tax, including haircuts, car repairs, and plumbing work. However, some services do carry tax. Parking fees in Philadelphia are taxed. Admission to movies, concerts, and sporting events is taxed at 8.0%.

Digital purchases — apps, e-books, streaming subscriptions, and software — are generally not taxed in Pennsylvania. However, digital goods delivered as a physical product (like a DVD or video game disc) are taxed. The rules vary depending on how the product is delivered and what it is classified as.

If you are unsure whether a service or digital item is taxed, ask the seller before you buy. The tax is added at checkout, so you will see the final amount before you pay.

How Sales Tax Works on Online Purchases

When you order from an online retailer, whether sales tax is added depends on where the seller is located and whether they have a physical presence in Pennsylvania. Large retailers like Amazon and Walmart collect Philadelphia sales tax on orders shipped to Philadelphia addresses because they have warehouses or offices in the state.

Smaller online sellers may not collect sales tax if they do not have a business location in Pennsylvania. In those cases, you technically owe the tax yourself, though it is rarely enforced for individual purchases. The seller's checkout page will show whether tax is being added.

If you are buying from a seller outside the United States, sales tax usually does not explore, but you may owe federal import duties depending on the item and its value.

Sales Tax on Cars and Large Purchases

When you buy a car in Philadelphia, you pay sales tax on the purchase price. The tax applies to both new and used vehicles. If you trade in an old car, the sales tax is calculated on the difference between the new car's price and your trade-in value, not the full price. A $20,000 car with a $5,000 trade-in is taxed on $15,000.

Furniture, appliances, and electronics are all taxed at 8.0% in Philadelphia. There is no threshold — a $10 item and a $10,000 item are both taxed the same way. The tax is added to the final price you see on the receipt.

Frequently Asked Questions

Do I pay sales tax if I buy something in the suburbs and bring it back to Philadelphia?

No. Sales tax is based on where the purchase happens, not where you live or where you use the item. If you buy something in Cheltenham, you pay Cheltenham's rate (6%). You do not owe Philadelphia tax on it later.

Is there a sales tax on used items sold by individuals?

No. Private sales between individuals are not taxed. If you buy a used car from a private seller, you do not pay sales tax. However, if you buy a used car from a dealer, sales tax applies.

What happens if the cashier forgets to add sales tax?

The store is responsible for collecting the correct tax. If you notice it was not added, you can point it out at checkout. The store may ask you to pay it then, or they may absorb the cost themselves. You are not liable for the store's mistake.

Do I owe sales tax on items I order online from out of state?

If the seller does not collect it, you technically owe it to Pennsylvania, but it is not enforced for individual purchases. Large retailers collect it automatically. For small purchases from small sellers, the tax usually goes unpaid.

Is there sales tax on gift cards?

No. Buying a gift card is not taxed. However, when the gift card is used to buy a taxable item, that item is taxed normally.