New York charges sales tax on most goods and some services, and the rate depends on which county you're in
Sales tax in New York is a tax added to the price of items you buy. The state sets a base rate of 4 percent, but most counties add their own tax on top of that. Your total sales tax rate ranges from 4 percent in some areas to 8.875 percent in New York City. The tax is collected by the store at checkout and sent to the state and local tax departments.
You don't file sales tax on your personal tax return — the business selling you the item handles that. But understanding what is and isn't taxed helps you know what you'll actually pay and matters if you run a small business or sell items online.
Key Takeaways
- New York's state sales tax is 4 percent, but counties add local tax, making your total rate between 4 and 8.875 percent depending on where you shop.
- Most physical goods are taxed, but groceries, prescription medications, and some clothing under $110 are exempt.
- Services like haircuts, repairs, and professional fees are generally not taxed in New York, though there are exceptions.
- If you buy something online from an out-of-state seller, you may owe use tax on that purchase, though most people don't report it.
Sales tax rates by New York county
The state portion is always 4 percent. On top of that, each county adds between 0 and 4.875 percent. New York City (which includes Manhattan, Brooklyn, Queens, the Bronx, and Staten Island) has the highest combined rate at 8.875 percent. Westchester County is 8.875 percent. Upstate counties like Erie (Buffalo area) are 8 percent, while some rural counties are as low as 4 percent.
The rate that applies is the one where the sale happens, not where you live. If you live in a 4 percent county but drive to New York City to shop, you pay 8.875 percent. If you order online and the seller ships to your address, the rate depends on your delivery address, though this varies by seller and is still being clarified by the state.
What is taxed and what is not
Taxed items include clothing and shoes (with one exception), electronics, furniture, books, toys, and most other goods. Prepared food — anything hot or meant to eat right away — is taxed. A hot pizza slice is taxed; a frozen pizza you cook at home is not.
Exempt items include groceries (unprepared food), prescription medications, medical equipment like wheelchairs and hearing aids, and clothing or footwear under $110 per item. Items over $110 are taxed on the full amount, not just the overage. A $150 coat is taxed on the whole $150.
Services are generally not taxed. Haircuts, plumbing repairs, medical visits, legal information, and car repairs have no sales tax. However, some services are taxed: dry cleaning, laundry, and certain telecommunications services are subject to tax in New York.
How sales tax appears on your receipt
When you check out, the store shows the subtotal, then adds the sales tax, then shows your total. The tax amount is calculated on the subtotal before any discounts are applied — if you have a coupon, the tax is usually calculated on the reduced price. Some stores round the tax to the nearest cent, which is legal in New York.
The store keeps a record of all sales tax collected and sends it to the New York Department of Taxation and Finance, usually monthly or quarterly depending on the business size. You don't receive a form or report for personal purchases — the store handles all the paperwork.
Use tax on online and out-of-state purchases
Use tax is a tax you owe on items you buy from out-of-state sellers and have delivered to New York. It's the same rate as sales tax would be in your county. If you buy something from an online retailer that doesn't collect New York sales tax, you are technically supposed to report and pay use tax on your state income tax return.
In practice, most individuals do not report use tax, and the state does not pursue individual consumers for it. However, if you run a business and buy supplies from out-of-state sellers, you should track these purchases and report use tax. Large online retailers like Amazon now collect sales tax in New York, so this matters less than it did a few years ago.
Sales tax for small business owners and resellers
If you sell goods in New York, you must register for a sales tax permit with the Department of Taxation and Finance, even if you only sell online. You collect tax from customers, then send it to the state. The rate you charge depends on where your customer is located, not where you are.
If you buy items to resell, you can provide a resale certificate to your supplier instead of paying sales tax on your purchase. You only pay tax when the final customer buys the item. Without a resale certificate, you pay tax on your wholesale purchase, then collect tax from the customer — you end up paying tax twice, which is why the certificate matters.
Common situations and what gets taxed
| Purchase | Taxed? | Why |
|---|---|---|
| Loaf of bread from a grocery store | No | Unprepared food is exempt |
| Sandwich from a deli | Yes | Prepared food is taxed |
| Jeans for $85 | No | Clothing under $110 is exempt |
| Winter coat for $200 | Yes | Clothing over $110 is taxed |
| Prescription eyeglasses | No | Medical equipment is exempt |
| Sunglasses | Yes | Not medical equipment |
| Haircut | No | Personal services are not taxed |
| Dry cleaning | Yes | Laundry and dry cleaning are taxed |
Frequently Asked Questions
Do I pay sales tax if I buy something online from a New York store?
Yes, if the store collects sales tax. Most major online retailers now collect New York sales tax based on your delivery address. If a small seller does not collect it, you technically owe use tax, but this is rarely enforced for individual purchases.
Is there sales tax on clothing in New York?
Clothing and footwear under $110 per item are exempt. Items $110 or more are taxed. A $109 shirt is not taxed; a $110 shirt is taxed on the full amount. The $110 threshold applies per item, not per purchase.
What if I buy something in New York but live in another state?
You pay New York sales tax at the time of purchase. The tax rate is based on where the sale occurs. You do not owe tax in your home state on that purchase because you already paid tax in New York.
Are groceries taxed in New York?
Unprepared groceries — bread, milk, vegetables, frozen dinners you cook yourself — are not taxed. Hot or prepared food from a grocery store deli, bakery section, or restaurant is taxed. The distinction is whether the food is ready to eat.
Do I need to charge sales tax if I sell items online?
Yes, if you have a physical presence in New York or meet certain sales thresholds, you must register for a sales tax permit and collect tax from New York customers. The rules depend on your business structure and sales volume, so check with the Department of Taxation and Finance about your specific situation.