Sales Tax

Consumption Taxes

By Jenna Nelson

What is consumption tax?

Consumption tax is a tax on the purchase of good and services in the form of sales tax, excise tax, and other special taxes.​

Subject | Subject

Some text here about the topic of discussion

A tax on certain goods that aren't typically considered a necessity; sometimes called a luxury tax.

Excise Tax

A tax on goods and services that goes to a state or local government.

Sales Tax

What is consumption tax? (continued)

Some text here about the topic of discussion

How do I calculate costs of items with tax included?

Convert the tax percentage into a decimal by dividing the number by 100.

Multiply the t​ax percentage by the cost of the item.

Add the tax amount, in dollars, to the original price.​

Subject | Subject

Some text here about the topic of discussion

Fill in the Blanks

If the sales tax rate is 7.25% in California, then how much would you pay in Los Angeles for a pair of shoes that cost $39.00? Round your answers to the nearest cent.

Fill in the Blanks

The price of a new car is $29,990. If the sales tax rate is 6.5%, then how much sales tax is being charged? What is the total cost for the car including tax? Round your answers to the nearest cent.

Fill in the Blanks

If the sales tax rate is 7.375% in New York State, then how much sales tax would you pay in Albany for a $34 pair of pants?

Multiple Choice

CHECK FOR UNDERSTANDING: A tax on goods and services that goes to a state or local government.

• Consumption Tax

• Sales Tax

• Excise Tax

Multiple Choice

CHECK FOR UNDERSTANDING: A tax on certain goods that aren't typically considered a necessity; sometimes called a luxury tax.

• Consumption Tax

• Sales Tax

• Excise Tax

Fill in the Blanks

CHECK FOR UNDERSTANDING: At best buy they have a 42” TV that sells for $1250 and sales tax is 6.5%. What is the final cost? Round to the nearest cent.