North Carolina's statewide sales tax rate is 4.75 percent
North Carolina charges a 4.75 percent sales tax on most retail purchases. This is the base rate that applies statewide. However, many counties add their own local sales tax on top of the state rate, which means your total sales tax can range from 4.75 percent to 7.5 percent depending on where you shop.
The state tax goes to North Carolina's general fund. Local taxes are collected by individual counties and typically fund schools, transportation, or other county services. When you buy something at a store, the cashier charges you both rates combined, but they are separate taxes going to different places.
Key Takeaways
- North Carolina's state sales tax is 4.75 percent, but your total rate depends on which county you are in because most counties add 0.5 to 2.75 percent on top.
- Sales tax applies to tangible goods like clothing, electronics, and groceries, but not to services like haircuts, repairs, or professional fees.
- Groceries for home consumption are taxed at a reduced rate of 2 percent instead of the full sales tax rate.
- Some items like prescription medications and medical equipment are exempt from sales tax entirely.
- You pay sales tax at the point of sale in the county where the store is located, not where you live.
How county taxes stack on top of the state rate
North Carolina allows each county to add a local sales tax, and most do. The local rate ranges from 0.5 percent to 2.75 percent depending on the county. This means if you shop in Mecklenburg County (Charlotte), you pay 4.75 percent state plus 2.25 percent local, for a total of 7 percent. If you shop in a county with no local tax, you pay only 4.75 percent.
The county where the store is physically located determines which tax you pay, not the county where you live. If you live in a county with no local tax but drive to a neighboring county to shop, you pay that neighboring county's rate. Online purchases are more complicated — the seller's location, your location, and the seller's tax registration status all matter, and the rules vary by retailer.
You can find your county's local rate by searching "North Carolina sales tax by county" or by calling your county tax assessor's office. The North Carolina Department of Revenue also publishes a complete list on its website.
What items are taxed and what are not
Sales tax applies to tangible goods — things you can touch and take home. Clothing, shoes, electronics, furniture, toys, and most household items are all taxed at the full rate. Services are generally not taxed. A haircut, car repair, plumbing work, or medical appointment are not subject to sales tax, even though you pay money for them.
Food is treated differently depending on where you eat it. Groceries you buy at a supermarket to cook at home are taxed at a reduced rate of 2 percent. But prepared food — restaurant meals, deli sandwiches, bakery items ready to eat — is taxed at the full sales tax rate. If you buy a rotisserie chicken from the grocery store deli, it is taxed as prepared food. If you buy a raw chicken to cook at home, it is taxed at 2 percent.
Alcohol and beverages have their own rules. Beer, wine, and liquor are taxed at the full sales tax rate. Soft drinks and energy drinks are also taxed at the full rate. But milk, juice, and coffee beans are taxed at 2 percent because they are considered groceries.
Exempt items you do not pay sales tax on
Some purchases are completely exempt from sales tax in North Carolina. Prescription medications are never taxed, whether you buy them at a pharmacy or through mail order. Over-the-counter medicines like aspirin or cold medicine are taxed at the full rate, but anything that requires a prescription is exempt.
Medical equipment and devices are often exempt if they are prescribed by a doctor. Wheelchairs, hearing aids, prosthetics, and diabetic testing supplies typically do not have sales tax applied. However, the rules depend on the specific item and how it is classified. If you are unsure whether a medical item is exempt, ask the seller or contact the North Carolina Department of Revenue.
Certain other items are exempt for specific reasons. Newspapers and magazines are not taxed. Seeds and plants for growing food are not taxed. Items purchased for resale by a business are not taxed if the business provides a resale certificate. But luxury items, even if they have some practical use, are taxed normally.
How sales tax works for online and mail orders
Online retailers must collect North Carolina sales tax if they have nexus in the state — meaning they have a physical presence like a warehouse, office, or employee. Large online retailers like Amazon, Walmart, and Target collect North Carolina sales tax on orders shipped to North Carolina addresses. Smaller retailers may not have nexus and may not collect the tax.
If a retailer does not collect sales tax at checkout, you are technically responsible for paying use tax to North Carolina when you file your tax return. Use tax is the same rate as sales tax and applies to items you bought out of state or online without tax being collected. In practice, most individual taxpayers do not report use tax, but it is a legal obligation if you made taxable purchases without paying sales tax.
The rules for marketplace sellers — people selling through Amazon, eBay, or similar platforms — are complex and have changed in recent years. Most major platforms now collect and remit sales tax on behalf of their sellers, but not all do. If you are selling items online, you should contact the North Carolina Department of Revenue or a tax professional to understand your obligations.
Sales tax on vehicles and special purchases
Motor vehicles are subject to sales tax in North Carolina, but the rate and how it is calculated differs from regular purchases. When you buy a car, truck, or motorcycle, you pay sales tax on the purchase price. However, if you trade in a vehicle, the sales tax is calculated on the net amount — the sale price minus the trade-in value. This can significantly reduce the tax you owe.
Vehicles purchased from a private party (not a dealer) are still subject to sales tax when you register them with the North Carolina Division of Motor Vehicles. You pay the tax at the DMV office when you transfer the title, not at the time of purchase. The tax is based on the fair market value of the vehicle, which the DMV determines using standard valuation guides.
Boats, aircraft, and other vehicles follow similar rules. Rental vehicles are taxed differently — the rental company pays sales tax on the rental fee, and you do not pay additional sales tax on top of the rental price.
Frequently Asked Questions
What is the total sales tax rate where I live?
Your total rate is 4.75 percent plus your county's local rate. To find your county's rate, search online for "North Carolina sales tax [your county name]" or call your county tax assessor's office. The North Carolina Department of Revenue website also has a complete county-by-county breakdown.
Do I pay sales tax on groceries in North Carolina?
Yes, but at a reduced rate of 2 percent instead of the full rate. This applies to food you buy at a supermarket to cook at home. Prepared foods like restaurant meals, deli items, and bakery goods ready to eat are taxed at the full sales tax rate.
Is sales tax added to the price shown on the shelf?
No. The price on the shelf does not include sales tax. The tax is added at checkout. This means if an item costs $10, you will pay $10 plus sales tax, which varies by county.
Do I have to pay sales tax on items I buy online from out-of-state sellers?
It depends on whether the seller has nexus in North Carolina and whether they collect tax. Large retailers collect North Carolina sales tax. Smaller sellers may not. If tax was not collected, you may owe use tax to North Carolina, though most individuals do not report it.
Are prescription medications taxed in North Carolina?
No. Prescription medications are completely exempt from sales tax. Over-the-counter medicines like aspirin are taxed at the full rate, but anything requiring a prescription is not taxed.