Financial Literacy—Calculating Sales Tax

Do you know how to calculate sales tax? In part six of our Financial Literacy for Kids series, you will learn how to do just that! Sales tax is an extra cost that is added to a product or service that you buy. The government uses sales tax money to pay for things, such as new roads and water lines.

Some states don't use a sales tax. Those states are Delaware, Alaska, Montana, New Hampshire, and Oregon. That means that if you want to buy something for $100, you only pay exactly $100, and no more. There are also states that don't charge sales tax on certain kinds of purchases, such as groceries and food or prescription medications.

Sales tax is calculated as a percentage of the purchase price of an item. Generally, the percentage is somewhere between 4% and 9%. Keep watching to follow along with the example to figure out how to calculate sales tax. You will also learn a cool trick for calculating sales tax easily!

We hope you and your student(s) enjoyed learning about these important skills! If you want even more information, head over to our website and download one of our many free lesson plans, full of activities, worksheets, and more!