Calculating Sales Tax

• To calculate the sales tax owed on an item, first change the sales tax percentage to a decimal by moving the decimal point two places to the left (for example, 5 percent to 0.05, 7.5 percent to 0.075, 8.25 percent to 0.0825) and then multiply the price of the item by this figure.
  
  That is, S = I * T, where S = the sales tax owed on an item, I = the price of the item and T = the statewide sales tax as a decimal.
  
  

Example #1

• Question:Frank buys a new skateboard in Cheyenne, Wyoming, for $50. Wyoming has a 4 percent state sales tax. How much sales tax must Frank pay on his purchase?
  
  Answer:First, convert 4 percent to a decimal by moving the decimal point two places to the left. 4 percent = 0.04. Then, multiply the price of the item ($50) by this decimal.
  
  50 * 0.04 = 2
  
  Therefore, Frank must pay a $2 sales tax on his purchase.
  
  

Example #2

• Question:Utah has a state sales tax of 4.65 percent. Charlotte buys a book in Utah for $20. How much sales tax does Charlotte owe on her purchase?
  
  Answer:First, convert 4.65 percent to a decimal by moving the decimal point two places to the left. 4.65 percent = 0.0465. Then, multiply the price of the item ($20) by this decimal.
  
  20 * 0.0465 = 0.93
  
  Therefore, Charlotte owes 93 cents in sales tax on her purchase.