Among cities with the highest sales tax in the United States, several California municipalities lead the country at a combined 10.75 percent, with Long Beach at 10.50 percent, Seattle around 10.35 percent, Tacoma near 10.30 percent, Chicago at 10.25 percent, and Birmingham, Montgomery, and parts of Louisiana clustered near 10 percent. The national population-weighted average sits at 7.53 percent, so shoppers in the priciest cities pay roughly 40 percent more tax on every taxable purchase than the typical American consumer.
The Cities at the Top
California
California’s statewide base of 7.25 percent is already one of the highest in the country, and local district taxes push many cities well past 10 percent. Multiple cities in Los Angeles and Alameda counties now sit at 10.75 percent, including Compton, Culver City, and several Alameda County communities. Long Beach clocks in at 10.50 percent. These figures reflect layers of voter-approved district taxes for transit, public safety, and homeless services stacked on top of the state and county rates.
Seattle and Tacoma
Seattle’s combined rate stands at roughly 10.35 percent, with Tacoma close behind at about 10.30 percent. Washington has no individual income tax, which pushes its state rate to 6.50 percent before any local additions. The average combined rate across Washington is 9.51 percent, third-highest in the nation.
Chicago
Chicago’s combined rate is 10.25 percent. The Tax Foundation has specifically flagged the city’s rate as high enough to drive residents toward suburban stores or online shopping. The total blends a 6.25 percent state levy with county, city, and regional transit components.
Birmingham and Montgomery
Both Alabama cities reach roughly 10 percent despite a modest 4 percent state rate. Alabama lets local governments add between 0.1 percent and 5 percent on top of the state base, and Birmingham and Montgomery use that authority aggressively. Local additions in these cities actually exceed the state’s own contribution to the total.
Louisiana
Louisiana holds the highest average combined state and local rate of any state, at 10.11 percent. The state’s local taxing structure is fragmented, with parishes and municipalities each layering separate levies. Baton Rouge and other metro areas routinely appear on high-tax lists.
Nashville
Nashville’s combined rate rose to 9.75 percent after a 0.5 percent increase in Davidson County took effect in early 2025. Tennessee’s 7 percent state rate is among the highest in the country, and local jurisdictions can add up to 2.75 percent on top of it. The state’s overall combined average is 9.61 percent, second only to Louisiana.
How a Rate Above 10 Percent Gets Built
The percentage on your receipt is never a single tax. It stacks layers imposed by different levels of government, each authorized to collect revenue independently. A state sets a base rate that applies everywhere within its borders. Counties often add a second charge for regional services like courts or sheriffs. Cities tack on their own levy for local needs such as road repairs or fire protection.
A city with a modest local surcharge can still land near the top if its state and county rates are steep. The reverse also holds: a city with an aggressive local addition can climb the charts even from a low state baseline. That is why Birmingham clears 10 percent while Alabama’s state rate sits below the national median.
Most states cap how much local governments can pile on. Texas limits the combined local rate to 2 percent above the state base. Not every state imposes a ceiling, and where caps are generous or absent, the layering effect produces eye-catching totals.
Special taxing districts add another wrinkle. Transit authorities are the most common example: a regional bus or rail system may fund itself through a small sales tax add-on inside its service area, which is a major reason Seattle’s and Chicago’s totals run so high. Business improvement districts and tourism zones work similarly, funding streetscaping, security, stadiums, or convention centers from retail sales within a defined boundary. Two addresses in the same city can carry different rates because of these overlays.
Why These Cities and Not Others
Five states collect no statewide sales tax at all: Alaska, Delaware, Montana, New Hampshire, and Oregon. At the other end, the heaviest-rate states share a common feature. Louisiana, Tennessee, Washington, and Alabama all rank among the top five for combined rates, and none of them run a traditional broad-based income tax as a primary revenue source.
The logic is straightforward. When a state forgoes income tax revenue, it needs to replace those dollars somewhere, and sales tax is the most common substitute. Tennessee generates about 58 percent of its tax revenue from sales tax, compared to a national average closer to 33 percent. Washington has no individual income tax and leans on sales and use taxes to cover infrastructure and education costs. That structural choice creates the high baseline local governments then build on.
Property tax limitations compound the effect. Where state constitutions or statutes restrict how much local governments can raise through property taxes, city councils reach for the sales tax lever instead. The Southeast and parts of the West Coast are particularly prone to this dynamic, which is why the top-rate cities cluster in those regions rather than spreading evenly across the country.
What the Headline Rate Doesn’t Cover
A combined rate of 10 percent sounds brutal, but it rarely applies to everything in your cart. Most states exempt or reduce the rate on necessities. The majority exempt groceries entirely, and several of the high-tax states that do tax food apply a reduced rate. Alabama charges 2 percent on groceries rather than the full 4 percent state rate. Tennessee taxes food at 4 percent instead of 7 percent. Illinois drops its grocery rate to 1 percent.
Prescription drugs get similar treatment in nearly every state. Even in a city with a 10-plus percent headline rate, your pharmacy bill isn’t hit with the full charge. Over-the-counter medications are usually taxable.
These exemptions matter because they change the practical impact of living in a high-tax city. If most of your spending goes to groceries, rent, and medical care, a 10.75 percent rate overstates your actual exposure. The rate bites hardest on discretionary spending: electronics, furniture, clothing in states that tax it, restaurant meals, and other non-exempt purchases.
About 20 states also run sales tax holidays, and several of the highest-rate states participate. The most common version is a back-to-school holiday in late July or August covering clothing, shoes, school supplies, and sometimes computers up to a price cap. Alabama, Tennessee, and Arkansas all run one annually. Texas offers three: back-to-school, emergency preparedness supplies, and energy-efficient appliances. The savings are real but narrow. Holidays typically last two to three days and cover a limited product set, so they function as a targeted discount rather than a structural fix.
Whether You Can Shop Around It
Online shopping used to be an escape hatch. It isn’t anymore. The 2018 Supreme Court decision in South Dakota v. Wayfair eliminated the old rule that online sellers only had to collect sales tax where they had a physical presence. States can now require remote sellers to collect once they cross an economic nexus threshold, which South Dakota set at $100,000 in sales or 200 transactions per year. Nearly every state with a sales tax has adopted a similar standard.
Most states use destination-based sourcing for online orders, meaning the rate charged is based on where you receive the product, not where the seller sits. If you live in a city with a 10.25 percent combined rate, that is what gets added to your order. Marketplace facilitator laws close the remaining gap: platforms like Amazon, eBay, and Etsy are now required in nearly every taxing state to collect and remit sales tax on behalf of their third-party sellers, so even a very small seller’s transaction gets taxed at your local rate.
Vehicles are the other place shoppers try to arbitrage. Most states tie the tax to where you register the car rather than where the dealership sits. If you live in a city with a 10 percent combined rate and buy at a dealership in a neighboring county with a 7 percent rate, you’ll generally owe the difference when you register and title the vehicle at your local clerk’s office. Some states exempt the purchase from local tax at the point of sale for out-of-jurisdiction buyers and collect use tax at the buyer’s home rate during registration.
On a $30,000 vehicle, the difference between 7 percent and 10.5 percent is $1,050. Real money, but money most states have structured their laws to capture regardless of where the sale happens. For registered assets, the arbitrage doesn’t work. For general retail, it depends on whether your state uses destination-based or origin-based sourcing, which determines whether a drive to a lower-rate city saves you anything on delivered goods or only on what you carry out the door.