Texas sales tax at a glance
| Type of tax | Sales and use tax |
|---|---|
| State rate | 6.25% |
| Local rates | Average 1.95%, highest 2.00% |
| Average combined rate | 8.20% |
| Groceries | ExemptFood for home consumption is exempt from state and local tax. Candy, soft drinks and prepared food are taxable. |
| Prescription drugs | ExemptPrescription drugs are exempt, and so are over-the-counter drugs that carry an FDA "Drug Facts" label. |
| Clothing | Taxed (tax-free weekend in August)Clothing is taxed at the full rate, except items under $100 during the August back-to-school holiday. |
Local averages are population-weighted figures from the Tax Foundation: State and Local Sales Tax Rates, Midyear 2026 (rates as of 1 July 2026). They are a guide, not the rate at any one address. For the exact rate where you buy, use the Texas Comptroller Sales Tax Rate Locator.
Worked examples
A $1,200 laptop in Houston (8.25%)
| Rate | 6.25% state + 2% local = 8.25% |
|---|---|
| Price before tax | $1,200.00 |
| Sales tax | $99.00 |
| Total | $1,299.00 |
Working: $1,200.00 × 8.25% = $99.00. Houston uses the full 2% local allowance (1% city plus 1% METRO transit), so the combined rate is the Texas maximum of 8.25%.
Working back from a $54.13 receipt at 8.25%
| Rate | 6.25% state + 2% local = 8.25% |
|---|---|
| Price before tax | $50.00 |
| Sales tax | $4.13 |
| Total | $54.13 |
Working back: $54.13 ÷ 1.0825 = $50.00, so the tax was $4.13. Dividing by 1.0825 gives the pre-tax price. Taking 8.25% off the total instead would understate the price by about 34 cents.
How Texas local sales tax works
Local sales tax in Texas can come from a city, a county, a transit authority and special purpose districts, but all local taxes together are capped at 2%. That is why the Tax Foundation's highest local rate is exactly 2.00% and the average is 1.95%: almost every populated area already uses the full 2%. A few rural areas have lower combined rates. Sales are generally taxed where the seller is located for in-state sellers, while remote sellers charge the rate at the delivery address. Use the Comptroller's Sales Tax Rate Locator to find the rate for an address.
What is exempt in Texas
Texas exempts food for home preparation, such as bread, meat, milk, fruit and vegetables, from both state and local tax. Candy, soft drinks and prepared food (a hot rotisserie chicken, a deli sandwich) are taxable. Prescription drugs are exempt, and so are over-the-counter medicines with an FDA "Drug Facts" panel. Clothing, electronics, furniture and most other goods are taxed at the full combined rate.
Texas sales tax holidays in 2026
Texas held three sales tax holidays in 2026: emergency preparation supplies on 25 to 27 April, ENERGY STAR and water-efficient products on 23 to 25 May, and the back-to-school holiday on 7 to 9 August, when clothing, footwear, school supplies and backpacks under $100 were tax-free. The holidays cover both state and local tax. They recur each year on dates set by law, so check the Comptroller's announcements before you plan a big purchase around one.
Texas vs. neighboring states
| State | State rate | Avg. combined | Groceries |
|---|---|---|---|
| Texas | 6.25% | 8.20% | Exempt |
| New Mexico | 4.875% | 7.68% | Deductible (not taxed) |
| Oklahoma | 4.5% | 9.06% | No state tax; local applies |
| Arkansas | 6.5% | 9.48% | No state tax since 2026; local |
| Louisiana | 5% | 10.13% | No state tax; local may apply |
Average combined rates are from the Tax Foundation, midyear 2026 report. See sales tax rates for every state for the full table.