GlossaryUS
What is US sales tax?
State and local sales and use tax
Short answer
Sales tax is a tax US states and local governments charge on retail sales, leases and some services. The seller collects it, and the rules and rates differ from state to state.
Explained
In Texas, for example, local taxes are added on top of the state sales tax. Sellers engaged in business in Texas get a sales and use tax permit, and out-of-state sellers must get one once their Texas revenue exceeds a set threshold.
Marketplace providers such as Amazon collect and remit sales tax on sales made through them. Out-of-state sellers who sell only through such marketplaces may not need a Texas permit but must still keep records; sellers based in Texas must hold a permit.
Good to know
- Permit holders keep filing returns even when they have no taxable sales.
- Owners without a Social Security Number cannot apply for a Texas permit online; they apply by email or fax.
- A resale certificate is used to avoid paying sales tax on purchases made for resale.
Official sources
- Texas Comptroller — Sales and use tax
- Texas Comptroller — Remote sellers
- Texas Comptroller — Marketplace providers and sellers
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This page is general information, not legal or tax advice. Rules change; check the official source for the latest position or talk to us.
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