Sales Tax

A tax charged by the government to raise money so it can provide public services.

It is based on a certain percent of the price.

Example: Your State charges 8% sales tax.
You want to buy a t-shirt advertised for $20
Sales Tax is $20 × 8% = $1.60
So you have to pay a total of $20 + $1.60 = $21.60

Tax rates can vary by location and item, some items might not be taxed at all.

In some countries, the tax is included in the advertised price (such as VAT or GST). Businesses collect the tax but send it to the government, they don’t get to keep it!