Texas Reverse Sales Tax Calculator.

Texas has a state sales tax rate of 6.25%, and cities, counties, and special districts can add their own taxes up to a total local rate of 2%. This makes the maximum possible combined rate in Texas 8.25%, and many Texas cities have reached this maximum.

Austin, Dallas, Houston, and San Antonio all have combined rates of 8.25% (6.25% state + 2% local maximum). This is because all of these cities have stacked their city rate (1.25%–2%) plus county rates and any special district taxes to reach the legally allowed maximum of 2% local. Most Texas cities and suburbs reach or approach the 8.25% combined maximum.

Texas has no personal income tax, and the state relies heavily on sales tax and property tax revenue. Texas applies the 6.25% state sales tax broadly, including to many purchases that other states exempt. However, Texas does exempt most grocery food for home consumption from the sales tax. Texas also has a specific list of tax-free items during its Sales Tax Holiday — typically a weekend in August covering school supplies and clothing, and separate holidays for energy efficiency products and emergency preparation supplies.

Texas exempts prescription drugs and qualifying medical devices. Agricultural products and equipment used in farming or ranching are broadly exempt. Manufacturing equipment and raw materials incorporated into manufactured goods are also exempt.

The Texas Comptroller of Public Accounts administers the state sales tax. Texas uses origin-based sourcing for in-state sellers and destination-based sourcing for remote sellers. Economic nexus threshold in Texas is $500,000 in annual Texas sales (higher than most other states).