Prices, sales tax and paying in shops

Newcomers from countries where shelf prices include value-added tax often notice that:

• The price on the label is usually before tax; sales tax is added when you pay.
• The rate depends on where you receive the goods within New York State, and in New York City it is 8.875%.
• Some everyday items are taxed differently, for example clothing and shoes under $110.
• Card payments, including tap-to-pay, are widely used, and payment screens may ask whether you want to add a tip.

New York's sales tax has three parts in New York City: the 4% state rate, the 4.5% city rate and the 0.375% Metropolitan Commuter Transportation District tax, for a combined 8.875%. The rate that applies depends on where you receive the item, so deliveries outside the city may be taxed at a different local rate.

Clothing and footwear sold for less than $110 per item or pair are fully exempt from state and local sales tax in New York City. The exemption does not cover items of $110 or more, costumes, rented formal wear, athletic equipment or protective devices.

Rates differ across New York State because counties and cities set their own local rate, and not every county applies the clothing exemption. Some services are taxed and others are not; in New York City, for example, local sales tax also applies to services such as hairdressing, manicures and massage. If you shop online, the seller usually charges the rate for the delivery address.