Yes, there is tax on iPhones in almost every state. Forty-five states charge sales tax on the full retail price of the phone, which works out to roughly $40 on a $799 iPhone 17 in a low-tax jurisdiction and closer to $100 on a $999 iPhone Air in a high-tax city. Only five states skip the statewide sales tax entirely, and even one of those lets local governments charge their own.
How Much Sales Tax Adds to the Price
Sales tax is calculated on the sticker price of the phone, not on a discounted or financed amount. A $1,099 iPhone 17 Pro is taxed on the full $1,099. The retailer collects the money at checkout and forwards it to the state.
Combined rates in the 45 taxing states run from under 5 percent to more than 10 percent in some metropolitan areas.1Tax Foundation. State and Local Sales Tax Rates, 2026 Most states layer a base state rate with additional county and city rates, so two Apple Stores ten miles apart can charge different totals. On a $799 iPhone 17, that spread means anywhere from about $40 to more than $80 in tax.
Five states impose no statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. Alaska is the exception you have to watch. It lets individual municipalities levy their own local sales taxes, so an iPhone bought in Juneau or Anchorage can still carry a charge even though the state collects nothing. Delaware, Montana, New Hampshire, and Oregon have no local sales taxes either, making iPhone purchases in those four states genuinely tax-free.
Financing and Installment Plans Don’t Cut the Tax
Paying for the iPhone over 24 or 36 months instead of upfront doesn’t lower what you owe in tax. Most carriers require you to pay the full sales tax at the time of purchase, calculated on the phone’s retail price before any promotional credits or trade-in adjustments are applied.
Apple’s iPhone Upgrade Program handles this two ways. Buy in an Apple Store and the tax is rolled into your 24-month installment loan, spreading it out with the device payments. Buy through apple.com and Apple charges the tax separately at checkout instead of financing it.2Apple. iPhone Upgrade Program Terms and Conditions Either way, the tax is based on the full retail price.
This is what surprises people who sign up for a “free” phone through a carrier. The device may cost nothing after 36 months of bill credits, but sales tax still applies to the pre-credit retail price, and it’s due upfront. That’s often $50 to $100 you have to hand over the day you walk out with the phone.
Trade-Ins Sometimes Reduce the Taxable Amount
Handing in your old iPhone as part of the purchase can lower your sales tax bill, but only if your state allows it. Over 30 states let the value of a trade-in offset the taxable price of the new device, so you’re taxed on the difference. Trade in a phone worth $300 toward a $999 iPhone and you’d owe tax on $699.
The rest require sales tax on the full purchase price no matter what you trade in. On a $300 trade-in at an 8 percent rate, that’s about $24 in tax savings you get in one state and don’t get in another. If you order online, the shipping address controls which state’s rules apply, so your home state’s trade-in law is what matters.
Tax-Free Weekends Usually Skip Phones
Several states run annual sales tax holidays, often timed to back-to-school shopping in August, that waive tax on certain goods. iPhones almost never qualify. States that include computers in their tax-free lists routinely carve out cell phones, smartphones, and handheld devices used for calls or media. South Carolina’s tax-free weekend, for example, covers computers and printers but explicitly excludes cell phones and smartphones.
Even where a smartphone could theoretically qualify, price caps tend to disqualify iPhones. A holiday that exempts electronics under $500 doesn’t help when the cheapest current iPhone starts at $599, and going over the cap generally means tax on the full price, not just the amount above the threshold.
Ordering Online Doesn’t Avoid the Tax
Buying from Apple’s website, Amazon, Best Buy, or a carrier’s online store won’t spare you the sales tax. After the Supreme Court’s 2018 ruling in South Dakota v. Wayfair, states can require out-of-state online sellers to collect sales tax whenever the seller has a meaningful economic presence in the state, generally more than $100,000 in sales or 200 transactions a year.3Supreme Court of the United States. South Dakota v. Wayfair, Inc. Every major iPhone retailer clears that bar in all 45 taxing states.
If you did manage to buy from a seller that didn’t charge sales tax, you’d still owe “use tax” to your home state at the same rate. State income tax returns include a line for reporting untaxed purchases, and unpaid use tax can accrue interest and penalties. For iPhones specifically this is mostly theoretical now, because every retailer large enough to sell new devices collects the tax automatically.
Buying an iPhone Abroad
Purchasing an iPhone while traveling outside the United States runs into a different tax system. Most countries use a Value Added Tax that’s included in the displayed price rather than added at checkout. European VAT rates typically fall between 19 and 25 percent, so a substantial share of the sticker price is tax even though you never see it listed separately.
Non-residents can often reclaim it. In the European Union, tourists are entitled to a VAT refund on goods purchased during their visit, as long as they show the items and refund paperwork to customs before leaving the EU and within three months of purchase.4European Union. VAT – Value Added Tax Each country runs its own process, some digital and some paper-based, and refund operators may take a fee. An iPhone’s price easily clears any minimum purchase threshold.
Coming back through U.S. customs brings up a separate charge. Returning residents get an $800 personal exemption on goods accompanying them from most countries.5U.S. Customs and Border Protection. Types of Exemptions From U.S. insular possessions like the U.S. Virgin Islands or Guam, the exemption is $1,600.6eCFR. 19 CFR Part 148 – Personal Declarations and Exemptions With the least expensive current iPhone starting at $599, a single phone eats up most of your exemption. If the total value of everything you’re carrying back exceeds the limit, you have to declare it and may owe duty on the excess. Not declaring can lead to penalties or seizure.