Texas Sales Tax Rate Explained
Texas charges a 6.25% state sales tax, and the state constitution caps the total combined rate at 8.25% in most places. The Tax Foundation's midyear 2026 data shows an average local add-on of 1.95%, bringing the typical combined rate to 8.20%, ranking 14th nationally. The big cities all sit at the 8.25% ceiling.
Like its lack of an income tax, the sales tax does heavy lifting in Texas. It is the state's largest tax revenue source, which is why the rate sits above the national median even though the base looks moderate on paper.
What Is Taxed and What Is Exempt in Texas
Texas taxes most tangible goods at the full combined rate: clothing, electronics, furniture, vehicles, and restaurant meals. A defined list of services, including data processing and some amusement services, is also taxable, though most professional services escape.
Groceries are fully exempt from the state rate, so unprepared food rings up tax-free. Prescription drugs and many over-the-counter medicines are exempt too. The grocery exemption is one of the most valuable in the country given how high the combined rate otherwise runs.
Example: A $1,000 Purchase in Houston
Houston's combined rate is 8.25%, the state maximum: 6.25% state plus 2% in city and special district taxes. A $1,000 appliance purchase works out to $1,000 times 0.0825, which is $82.50 in tax, for a total of $1,082.50. Dallas and Austin produce the identical receipt.
Smaller towns without the full local stack can be cheaper. A town charging only the 6.25% state rate turns that same $1,000 into $62.50 of tax and a $1,062.50 total, a $20 difference driven entirely by local add-ons.
Local Sales Taxes in Texas
Texas cities can levy up to 2% in local sales taxes, split between the city itself and special purpose districts for things like economic development and property tax relief. The Tax Foundation lists the maximum local add-on at 2.00%, and Houston, Dallas, Austin, and San Antonio all use the full amount.
The 8.25% cap keeps things predictable. No Texas jurisdiction can push the general combined rate past it, so shoppers always know the worst case before they walk in.
Online Shopping and Marketplace Sales in Texas
Texas requires remote sellers and marketplace facilitators to collect once they cross economic nexus thresholds, so the major platforms charge Texas tax automatically. Local tax sourcing follows the delivery address, which is why the city portion can vary on online orders.
One nuance: Texas uses origin sourcing for intrastate sales by Texas sellers but destination sourcing for out-of-state sellers. For most shoppers the practical result is the same, which is the combined rate for the delivery zip code appearing at checkout.
Does Texas Have a Sales Tax Holiday?
Yes. Texas holds its tax-free weekend on the second weekend of August, which means August 7 through 9 in 2026. Clothing, footwear, backpacks, and school supplies priced under $100 per item are exempt from state and local tax.
The $100 per-item cap is the key detail. A $120 pair of sneakers does not qualify, but two $60 shirts do. Texas also runs a separate emergency preparedness holiday in April for items like generators and storm supplies.
Frequently Asked Questions
What is the Texas sales tax rate?
The state rate is 6.25%. With local add-ons averaging 1.95%, the typical combined rate is 8.20%; Houston, Dallas, and Austin are 8.25%.
Are groceries taxed in Texas?
No. Unprepared groceries are fully exempt from Texas sales tax.
What is the sales tax in Houston?
Houston's combined rate is 8.25%, the maximum allowed: 6.25% state plus 2% local.
Does Texas have a sales tax holiday?
Yes. The second weekend of August each year. In 2026 it is August 7 to 9, covering clothing, footwear, backpacks, and school supplies under $100 per item.
What is the maximum sales tax in Texas?
8.25% in most jurisdictions, capped by the state constitution.
Do online sellers collect Texas tax?
Yes, once they meet nexus thresholds. Marketplace facilitators collect based on the delivery address.
Related Calculators
Compare all 50 states on the main Sales Tax Calculator, or check the neighbors on our Oklahoma, New Mexico, and Tennessee pages. For take-home pay with no state income tax, try the Texas Paycheck Calculator.
Sources: Tax Foundation, State and Local Sales Tax Rates, Midyear 2026 and 2026 sales tax holiday roundup. Figures reviewed for 2026. This calculator provides an estimate for planning purposes and is not tax advice, confirm your exact rate with the Texas Comptroller of Public Accounts.