Tax-exempt stores are retail locations where you pay no sales tax at the register, either because the state doesn’t charge one, the store sits on federal or tribal land outside state taxing power, or the goods are legally treated as leaving the country. The five main categories are shops in the five states with no sales tax, military exchanges and commissaries, duty-free retailers at international airports, stores on tribal reservations, and temporary sales tax holidays. The savings are real, but your home state’s use tax can follow you home on anything valuable enough to matter.
The Five States With No Sales Tax
Five states collect no statewide sales tax: New Hampshire, Oregon, Montana, Alaska, and Delaware. They’re sometimes called the NOMAD states, and in most of them the sticker price is what you pay at the register. On a laptop or a piece of furniture, skipping a 6% or 7% levy adds up quickly, which is why cross-border shopping from neighboring states is common.
Two of the five carry caveats worth knowing before you drive across a state line. Alaska charges nothing at the state level but lets cities and boroughs impose their own sales tax, and as of January 2026 local rates run as high as 7.85%. A purchase in Anchorage (no local tax) is not the same as a purchase in a small borough at the top of the range. Montana has no general sales tax either, but tourist-oriented towns can impose a local resort tax on lodging, restaurants, bars, and recreational facilities, with several resort communities charging 3% in those categories. Ordinary retail goods aren’t hit, but the tax shows up on restaurant bills in ski towns and gateway communities near national parks.
Delaware, New Hampshire, and Oregon have no local sales taxes at all, so their retail markets stay consistently tax-free.
Military Exchanges and Commissaries
Military exchanges and commissaries are among the most straightforward tax-exempt stores in the country. Run by the Department of Defense through entities like the Army and Air Force Exchange Service and the Navy Exchange, they sit on federal property, and the Supremacy Clause bars states and local governments from imposing sales tax on purchases made there.
The core eligible group under Title 10 of the U.S. Code is active-duty service members, military retirees, and their dependents. Congress has expanded access considerably. Under 10 U.S.C. § 1065, the following also qualify for commissary and MWR facility access on the same basis as retirees:
- Purple Heart recipients
- Medal of Honor recipients
- Former prisoners of war
- Veterans with a VA-rated service-connected disability
- VA-recognized caregivers of eligible veterans
Veterans whose Veteran Health Identification Card shows a service-connected disability can use that card for installation access. Caregivers need a VA-issued letter confirming their status. Active-duty members, retirees, and dependents use a Common Access Card or Uniformed Services ID card. Trying to shop without valid credentials risks removal from the installation.
Duty-Free Shops at Airports and Border Crossings
Duty-free shops sell goods free of the excise taxes and import duties that normally apply to alcohol, tobacco, perfume, and other luxury items. Federal law defines a duty-free sales enterprise as a business that sells merchandise from a bonded warehouse for use outside the U.S. customs territory, delivering it at an airport or other exit point for exportation. These stores operate under 19 U.S.C. § 1555 and the implementing regulations in Title 19 of the Code of Federal Regulations, with Customs and Border Protection overseeing compliance.
The legal theory is that the goods are leaving the country, so there’s no domestic consumption to tax. In practice, you’ll need to show an international boarding pass or passport before completing a purchase. Items are typically placed in sealed bags, and some stores deliver purchases directly to the departure gate. Opening the sealed bag before clearing customs at your destination can result in confiscation.
The savings can disappear if you bring the goods back into the United States. Returning U.S. residents get a personal duty-free exemption of $800 worth of goods every 31 days, provided they were outside the country for at least 48 hours. Anything above that is subject to duties and taxes assessed by customs officers at the port of entry, and alcohol and tobacco fall under quantity limits within the exemption. “Duty-free” does not mean unlimited quantities tax-free on the way home.
Stores on Tribal Lands
Stores on Native American reservations often operate outside the reach of state sales tax because of tribal sovereignty. The Supreme Court has long held that states are categorically barred from taxing transactions involving tribal members that take place within their own reservation, a principle reaffirmed in Wagnon v. Prairie Band Potawatomi Nation and earlier in Oklahoma Tax Commission v. Chickasaw Nation.
For non-tribal members, the picture is murkier. Many tribes negotiate compacts with state governments that address how taxes apply to non-member customers. Under a typical compact, the tribe collects a tax equivalent to the state rate and keeps the revenue for tribal services and community development. Where no compact exists, enforcement varies. The exemption is most reliable for enrolled tribal members buying goods on their own reservation; non-members should not assume every purchase on tribal land is automatically tax-free.
Sales Tax Holidays
Roughly 19 states run temporary sales tax holidays each year, usually lasting a weekend or a full week. During these windows, specific categories of goods become tax-exempt up to a per-item price cap. The most common version is the back-to-school holiday in late July or August, covering clothing, school supplies, and sometimes computers or tablets. Several states also schedule holidays for emergency-preparedness supplies, energy-efficient appliances, and hunting or outdoor gear.
Price caps vary. Some states exempt clothing under $100 per item; others set the threshold above $150. Computers and electronics, where offered, often carry a separate higher cap. Because each state’s legislature sets its own dates, eligible items, and dollar limits, and these can change year to year, checking your state’s department of revenue website before the holiday weekend is the only reliable way to know what qualifies. Savings on any single item are modest; stacking multiple purchases over a back-to-school weekend can add up.
The Use Tax Catch
Buying something in a tax-free environment doesn’t always mean you’ve legally avoided the tax. Every state that imposes a sales tax also imposes a corresponding use tax, which exists specifically to cover purchases where sales tax wasn’t collected, whether you bought the item in a NOMAD state, from an out-of-state retailer, or on a trip abroad.
The use tax rate is almost always identical to the sales tax rate in your home state. If you live in a state with a 6.25% sales tax and buy a $2,000 television in tax-free New Hampshire, you legally owe $125 in use tax to your home state. Some states give credit for sales tax paid elsewhere: if you paid 4% in another state, you’d owe only the 2.25% difference. If you paid a higher rate somewhere else, your home state won’t refund the excess, but you won’t owe more.
Compliance among individual consumers is low. Most people either don’t know the obligation exists or assume it’s unenforceable on small purchases. States have responded in various ways, including adding a use tax line to the state income tax return, and online sales tax collection after the Supreme Court’s South Dakota v. Wayfair decision has narrowed the gap. For physical cross-border shopping, the legal obligation remains. On high-value items that require registration, such as cars and boats, state revenue departments can and occasionally do pursue the tax, because those purchases leave a paper trail.