Things You Might Not Get Right About Sales Tax

Is there a cap on a sales tax?

The maximum percentage a state can levy for a sales tax varies by state and its municipalities. The rates for sales taxes are fixed and set by each state. However, that fixed tax rate serves as a base rate, which can be increased.

For example, the New York sales tax is 4 percent at the state level, the local sales and use tax for New York City is 4.5 percent, and the Metropolitan Commuter Transportation District surcharge is 0.375 percent. So, the total sales tax you’ll pay in New York City is 8.875 percent.