Texas charges sales tax at the point of sale, and the rate depends on where you buy

Texas sales tax is a tax on goods and some services that you pay when you make a purchase. The state sets a base rate, but cities and counties add their own local taxes on top of it, so the total rate you pay varies by location. You do not send this tax to the state yourself — the business collects it from you at checkout and sends it to the Texas Comptroller of Public Accounts.

The state portion of Texas sales tax is 6.25 percent. Most cities and counties add between 0.5 and 2 percent, which means your total rate at checkout typically ranges from 6.25 to 8.25 percent, depending on your city and county. Some areas have lower combined rates, and a few have higher ones. The rate in your area is fixed, so the same purchase costs the same tax amount every time you shop there.

Key Takeaways

  • Texas sales tax is collected by the business at the register and includes both the state rate (6.25 percent) and local city and county additions.
  • Your total sales tax rate depends on your location and can range from 6.25 to 8.25 percent or higher in some areas.
  • Most goods are taxable in Texas, but groceries, prescription medicines, and some medical equipment are exempt.
  • Services are generally not taxed in Texas, with specific exceptions like hotel stays, car rentals, and certain repair work.
  • You can find your exact local sales tax rate on the Texas Comptroller website or by asking a business in your area.

What items are taxed and what are not

Most physical goods sold in Texas are subject to sales tax — clothing, electronics, furniture, toys, and household items all get taxed. However, some categories are exempt. Groceries (unprepared food you cook at home) are not taxed, but prepared food from a restaurant or deli counter is. Prescription medicines are exempt, but over-the-counter medications like aspirin or cold medicine are taxed.

Medical equipment and supplies have mixed rules. Wheelchairs, walkers, and oxygen equipment are typically exempt, but items like bandages and first-aid supplies are taxed. If you are unsure whether a specific medical item is exempt, the business can tell you, or you can contact the Texas Comptroller's office.

Services are generally not taxed in Texas, with important exceptions. Hotel stays are taxed (the tax is usually added to your bill). Car rentals are taxed. Repair services — like fixing your car, appliances, or phone — are usually not taxed, but labor charges for installation or assembly sometimes are, depending on the situation. Haircuts and salon services are not taxed. Consulting, accounting, and legal services are not taxed.

How local rates are built and why they differ by city

Texas sales tax has three layers. The state collects 6.25 percent. Cities can add up to 2 percent (though most add between 0.5 and 1.5 percent). Counties can add up to 0.5 percent. Some special districts — like public transportation authorities or economic development zones — can add small amounts on top of that.

Because each city and county sets its own rate, two towns next to each other can have different total rates. For example, one city might add 1 percent while a neighboring city adds 1.5 percent, making the difference 0.25 percent at checkout. This is why your receipt shows a different tax amount depending on where you shop. The Texas Comptroller maintains a database of all local rates by zip code, which you can search online.

Who collects the tax and where it goes

The business where you shop collects sales tax from you and holds it temporarily. The business then sends the tax to the Texas Comptroller, usually monthly or quarterly depending on the business size and the local rules. The Comptroller distributes the state portion to state programs and services. The local portion goes to the city and county where the sale happened, which use it for schools, roads, police, and other local services.

You never send sales tax directly to the state or local government — the business handles all of that. Your only responsibility is to pay the tax amount shown at checkout.

Sales tax on online and out-of-state purchases

If you buy something online from a business that has a physical location or employees in Texas, that business must collect Texas sales tax from you, just as if you walked into a store. If you buy from an out-of-state business that has no presence in Texas, the business is not required to collect Texas sales tax at checkout. However, Texas law says you owe "use tax" on those purchases — a tax equal to the sales tax rate in your area — though most individuals do not pay it unless they are audited.

Large online retailers like Amazon collect Texas sales tax on most items because they have warehouses and operations in the state. Smaller out-of-state sellers may not. If you are unsure whether tax was charged, check your receipt or order confirmation.

Finding your exact local sales tax rate

Your sales tax rate depends on your specific address, not just your city. Two neighborhoods in the same city might have slightly different rates if they fall into different special districts. The most reliable way to find your rate is to visit the Texas Comptroller's website and use their sales tax rate lookup tool by zip code or address. You can also call a local business and ask what rate they charge, or look at a recent receipt from a purchase in your area.

If you are moving to a new city or county in Texas, your sales tax rate will change. The new rate takes effect when ready once you cross into the new area, so the same item costs a different amount in tax depending on which side of the city line you buy it on.

Common situations and what gets taxed

A few everyday purchases confuse people. If you buy a sandwich from a restaurant, it is taxed. If you buy a loaf of bread from a grocery store, it is not. If you buy a birthday cake from a bakery, it is taxed (because it is prepared food). If you buy cake mix and frosting from a grocery store, they are not taxed. If you buy a bottle of water from a vending machine, it is taxed. If you buy a gallon of milk from a grocery store, it is not.

Clothing is taxed in Texas, including shoes, hats, and accessories. School supplies like notebooks and pens are taxed. Textbooks are taxed. Gasoline is taxed (the tax is included in the price per gallon). Utilities like electricity and water are not taxed. Postage stamps are not taxed.

Frequently Asked Questions

Is Texas sales tax the same everywhere in the state?

No. The state rate is 6.25 percent everywhere, but cities and counties add different amounts, so your total rate varies by location. You can have rates ranging from 6.25 to 8.25 percent or higher depending on where you shop. Use the Texas Comptroller's lookup tool to find your exact rate.

Do I have to pay sales tax on groceries?

Unprepared groceries — bread, milk, vegetables, meat, cereal — are not taxed. Prepared or ready-to-eat food from a restaurant, deli counter, or bakery is taxed. Hot food from a grocery store is usually taxed, while cold food is usually not.

Why is my sales tax different at two stores in the same city?

Stores in different parts of the same city may fall into different special tax districts (like public transportation zones), which can add small amounts to the base rate. Check your receipts or use the Comptroller's tool with your specific address to see your exact rate.

Do I owe sales tax on things I buy online from out-of-state sellers?

If the seller has no physical presence in Texas, they are not required to collect sales tax at checkout. Texas law says you owe use tax on those purchases, but it is rarely enforced for individual shoppers unless you are audited.

Are services taxed in Texas?

Most services are not taxed, including haircuts, repairs, and professional services. Exceptions include hotel stays, car rentals, and some installation or assembly labor. Check with the business if you are unsure.