How Is a 7-Percent Sales Tax Calculated?

How Is a 7-Percent Sales Tax Calculated?

To calculate a 7-percent sales tax, multiply the base price of the item by 0.07, states Basic-mathematics.com. Thus, tax on a $20 item would be equal to $2 times 0.07 or $1.40.

When given the tax rate as a percentage, calculating the amount of tax on any item is a two-step process. First, convert the tax rate from a percentage into a decimal value by dividing the tax rate by 100. Second, multiply the base price of the item by the decimal value determined in step one. The result is the amount of tax due. To calculate the total cost of the item, add the tax due to the base price.