Sales Tax

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What is the definition of Sales Tax?

A tax imposed by state or local governments on the sale of goods and services, collected by the retailer at the point of sale and remitted to the government.

Using Sales Tax in an Example

When a customer purchases a laptop for $1000 in a state with a 7% sales tax, the total cost at the register would be $1070, with $70 being the sales tax collected by the retailer and later remitted to the state government.

Using Sales Tax in a sentence

Remember to calculate the sales tax when you're setting the final price for the products; it affects how much the customers pay at checkout.

Related Terms

Surviving Spouse

A person whose spouse has died within the tax year and who may file a joint tax return for that year. Additionally, the surviving spouse can file joint returns for the next two years if they remain unmarried and maintain a household as the principal residence for a dependent child.

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Swap

A financial contract in which two parties agree to exchange streams of payments over a specified period, based on different indices such as interest rates, foreign exchange rates, or equity indices, applied to a notional amount. Swaps typically do not involve the exchange of principal.

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