New York City's combined sales tax is 8.875 percent

New York City charges 8.875 percent sales tax on most purchases. This rate is the sum of three separate taxes: the New York State sales tax (4 percent), the Metropolitan Transportation Authority tax (0.375 percent), and the New York City sales tax (4.5 percent). Each tax is collected by the same retailer at the same moment, but they fund different government services.

The 8.875 percent rate applies in all five boroughs — Manhattan, Brooklyn, Queens, the Bronx, and Staten Island. If you buy something in New York City, this is the rate you will see on your receipt, unless the item itself is exempt from sales tax.

Sales tax rates in the surrounding areas are lower. Westchester County charges 8.875 percent in some municipalities and 8.375 percent in others. Nassau and Suffolk counties on Long Island charge 8.875 percent. New Jersey charges between 6.625 and 7.625 percent depending on the county. This difference matters if you live near a border and buy large items.

Key Takeaways

  • New York City's 8.875 percent sales tax is split among the state (4 percent), the MTA (0.375 percent), and the city (4.5 percent).
  • Groceries, prescription medications, and most clothing under $110 per item are exempt from sales tax in New York City.
  • Restaurant meals, prepared foods, and alcohol are always taxed, even if the same item would be tax-free at a grocery store.
  • The tax applies to online orders shipped to a New York City address, regardless of where the seller is located.

What is and is not taxed in New York City

Not everything you buy in New York City is subject to the 8.875 percent rate. Groceries — unprepared food you cook at home — are exempt. This includes bread, milk, eggs, vegetables, fruit, meat, and frozen vegetables. The rule is whether the food is ready to eat or requires preparation.

Prepared foods cross the line into taxable territory. A rotisserie chicken from a grocery store is taxed. A salad bar is taxed. A sandwich made to order is taxed. A single slice of pizza is taxed. A whole pizza you take home is also taxed. The distinction is not about where you eat it — it is about whether the seller prepared it.

Prescription medications are exempt from sales tax in New York. Over-the-counter medications — vitamins, pain relievers, cold medicine — are taxed. Clothing and footwear under $110 per item are exempt. A $100 shirt is tax-free. A $120 shirt is taxed. A pair of $80 shoes is tax-free. Designer handbags, belts, and accessories are taxed regardless of price because they are not classified as clothing.

Alcohol and tobacco are always taxed, in addition to any excise tax they carry. Newspapers and magazines are exempt. Books are exempt. Textbooks are exempt. Digital downloads — e-books, music, software — are taxed.

How the tax is calculated on your receipt

When you buy a taxable item priced at $100, the sales tax added is $8.88 (rounded). The total you pay is $108.88. The retailer collects this $8.88 and remits it to New York State, which distributes it to the state, the MTA, and the city according to their shares.

If you buy multiple items, the tax is calculated on the total of all taxable items, not on each item separately. If you buy a $50 shirt (exempt), a $30 pair of socks (exempt), and a $40 book (exempt), your total is $120 with no tax. If you buy a $50 shirt (exempt) and a $40 restaurant meal (taxed), your tax is calculated only on the $40 meal, which comes to $3.55.

Some retailers round the total tax to the nearest cent. Others calculate it precisely. You may see slight variations in the final amount depending on the order in which items are rung up, though the difference is usually a penny or two.

Sales tax on online and mail orders

If you order something online and have it shipped to a New York City address, you owe New York City sales tax on that order. This applies whether the seller is located in New York or anywhere else in the country. The seller is required by law to collect the tax at checkout, though enforcement varies.

If a seller does not collect tax at checkout, you are technically responsible for paying it yourself through New York's use tax, which is the same rate as sales tax. In practice, most people do not pay use tax on individual purchases. The rule exists mainly to catch businesses that buy inventory out of state.

If you pick up an order in person at a New York City store, you pay sales tax. If you pick it up outside New York City — for example, at a store in New Jersey — you do not pay New York City tax, though you may owe New Jersey tax instead.

Sales tax on services and utilities

Most services are not subject to sales tax in New York. A haircut, a doctor visit, a plumbing repair, and a car wash are not taxed. However, some services are taxed. Telecommunications — your phone bill and internet bill — are taxed at 8.875 percent. Utilities — electricity, natural gas, and steam — are taxed at 8.875 percent.

Hotel rooms are taxed at 14.75 percent in New York City, which is higher than the standard sales tax rate. This is a separate hotel tax, not the sales tax. Parking is taxed at 8.875 percent. Gym memberships and entertainment venues (movie tickets, concert tickets, sports events) are taxed at 8.875 percent.

How sales tax differs from other New York City taxes

Sales tax is not the only tax you pay on purchases in New York City. Some items carry additional taxes on top of the 8.875 percent rate. Cigarettes and e-cigarettes carry a state excise tax of $4.35 per pack, plus a city tax of $1.50 per pack. Alcohol carries a state excise tax that varies by type (beer, wine, spirits). These excise taxes are added to the price before sales tax is calculated, so you pay sales tax on the tax itself.

Gasoline carries a state excise tax and a city tax, but sales tax is not applied to gasoline in New York. The pump price already includes all applicable taxes.

Real estate transfer tax is a separate tax paid when you buy property in New York City, not a sales tax. Income tax is a separate tax on wages and investment income. Property tax is a separate tax on real estate ownership. None of these are part of the 8.875 percent sales tax.

Frequently Asked Questions

Do I pay sales tax if I buy something in New York City and take it home to another state?

Yes, you pay New York City sales tax at the moment of purchase. Once you leave New York, you do not owe additional tax to your home state on that item. The sale happened in New York, so New York tax applies.

Is there a sales tax on groceries if I buy them at a restaurant or deli?

It depends on whether the food is prepared. A loaf of bread from a grocery store is not taxed. A sandwich made to order at a deli is taxed. A rotisserie chicken is taxed. Unprepared ingredients are not taxed, even if you buy them at a restaurant supply store.

What happens if a clothing item costs exactly $110?

Items priced at $110 or more are taxed. The exemption applies to items under $110. So a $109.99 shirt is exempt, and a $110 shirt is taxed.

Do I owe sales tax on items I sell to someone else?

No. Sales tax applies only to retail sales — when a business sells to a consumer. If you sell a used item to another person, no sales tax is owed. If you are running a business and selling items, you must collect and remit sales tax.

Is the 8.875 percent rate the same everywhere in New York City?

Yes, the 8.875 percent rate applies in all five boroughs. Some other parts of New York State have different rates — for example, parts of Westchester County charge 8.375 percent — but within New York City proper, the rate is uniform.