North Carolina's statewide sales tax is 4.75 percent

North Carolina charges a 4.75 percent sales tax on most retail purchases. This is the base rate that applies across the state. However, your actual tax at checkout will often be higher because counties and cities can add their own local sales taxes on top of the state rate.

The total tax you pay depends on where you make the purchase. A shirt that costs $20 in one county might have a different final price in another county just a few miles away, because the local add-on varies. Understanding how these layers work helps you know what to expect when you check out.

Key Takeaways

  • North Carolina's state sales tax is 4.75 percent, but most counties add a local tax on top of that, bringing the total to between 6.75 and 7.5 percent depending on where you shop.
  • Local tax rates are set by individual counties and cities, so the tax you pay varies by location within the state.
  • Groceries, prescription medications, and some medical equipment are exempt from sales tax in North Carolina.
  • Online purchases from out-of-state sellers may or may not include North Carolina sales tax, depending on whether the seller has a physical presence in the state.

How local taxes add to the state rate

On top of the 4.75 percent state tax, counties can add between 2 and 2.75 percent in local sales tax. This means the total you pay ranges from 6.75 percent to 7.5 percent depending on which county you are in. Some counties choose not to add any local tax, though this is rare.

Cities within those counties may also add their own tax in some cases, though most local tax comes from the county level. Before you move to a new area or make a large purchase, you can check your specific county's rate by contacting the county tax assessor's office or looking at the county government website.

What items are exempt from sales tax

Not everything you buy is taxed. Groceries — food you cook at home — are not subject to sales tax in North Carolina. This includes meat, produce, dairy, bread, and canned goods. However, prepared food, restaurant meals, and food you eat on the premises are taxed.

Prescription medications are also exempt. Over-the-counter medicines like aspirin or cold medicine are taxed, but prescription drugs filled by a pharmacist are not. Medical equipment prescribed by a doctor, such as wheelchairs or diabetic supplies, may be exempt as well, though the rules vary by item.

Clothing is taxed in North Carolina, including shoes and accessories. Some states exempt clothing, but North Carolina does not.

Sales tax on online and out-of-state purchases

If you order something online from a company that has a warehouse, office, or other physical location in North Carolina, that company must collect North Carolina sales tax from you. If the seller has no presence in the state, they may not be required to collect the tax, though you are technically responsible for paying it yourself when you file your taxes.

In practice, most large online retailers now collect sales tax in all states where they have a presence, which includes North Carolina for companies like Amazon. Smaller sellers may not. When you check out online, look at the tax line to see whether it has been added.

Where to find your county's exact rate

To find the exact sales tax rate for your county, contact your county tax assessor's office or visit your county government's website. The North Carolina Department of Revenue also maintains a list of county rates on its website, though the easiest route is usually a quick call to your county assessor.

If you are shopping in a different county than where you live, ask the cashier or check the receipt after you check out. The tax rate will be printed on your receipt, so you can see what was charged.

How sales tax is used

Sales tax revenue in North Carolina goes to the state general fund and to county and city budgets. The state portion funds schools, transportation, and other state services. The local portion funds county schools, roads, emergency services, and other local programs.

Unlike income tax, which is withheld from your paycheck, sales tax is collected at the point of sale. Businesses collect it and send it to the state and local tax authorities on a regular schedule, usually monthly or quarterly depending on the size of the business.

Frequently Asked Questions

Do I pay sales tax on used items?

Used items sold by individuals are not taxed. However, used items sold by a business or dealer are subject to sales tax in North Carolina. If you buy a used car from a dealership, for example, you will pay sales tax. If you buy from a private seller, you will not.

Is there sales tax on services in North Carolina?

Most services are not subject to sales tax in North Carolina. Haircuts, car repairs, plumbing work, and medical services are generally not taxed. However, some specific services like pest control or cleaning may be taxed depending on how they are classified. When in doubt, ask the service provider.

What if I buy something in one county and use it in another?

You pay the sales tax rate of the county where you make the purchase, not where you use the item. If you buy something in a county with a 7 percent rate and take it home to a county with a 6.75 percent rate, you pay the 7 percent rate at checkout.

Do I need to pay sales tax on items I order for delivery from out of state?

If the seller has a physical presence in North Carolina, they must collect North Carolina sales tax. If they do not, the tax may not be collected at checkout, but you may owe it on your state tax return. Most major retailers now collect it automatically.