The items most commonly exempt from sales tax are unprepared groceries, prescription medications, and basic medical supplies, and depending on the state you live in, the list can also include clothing, textbooks, menstrual products, newspapers, farm and manufacturing equipment, and anything you buy to resell. Five states charge no statewide sales tax at all. The other forty-five each write their own exemption list, so the same shirt or cold medicine can be taxed in one state and tax-free across the border. Combined state and local rates run from zero to over 10 percent, with a population-weighted average of about 7.5 percent in 2026, which is enough to make these carve-outs matter at the register.
What follows are the categories that appear on most state exemption lists, along with the common limits and exceptions. Rules vary, so treat this as the shape of the landscape rather than the law of any particular state.
Groceries and Unprepared Food
Grocery food is the most widely exempted category in the country. A majority of states with a sales tax exempt most unprepared food from the standard rate, and several others tax groceries at a reduced rate. The line is nearly the same everywhere: raw ingredients and staples you take home to cook are exempt, while hot prepared meals, restaurant food, and items sold ready to eat are taxable. Carbonated drinks and alcohol are almost always taxed no matter where you buy them.
The definition of “prepared” gets specific. Heating triggers taxability in most states, so a rotisserie chicken from the deli is taxed while a raw chicken from the meat case is not. Combining two or more ingredients into a single item for sale can also push a product into the prepared category. Bakery items are a frequent exception: bread, rolls, and pastries sold unheated usually stay exempt even though the bakery mixed the ingredients. In some jurisdictions, handing you utensils with your purchase is enough to make the sale taxable.
One rule cuts across every state. Under federal law, states that participate in the Supplemental Nutrition Assistance Program cannot collect sales tax on food purchased with SNAP benefits.1Office of the Law Revision Counsel. 7 USC 2013 – Establishment of Supplemental Nutrition Assistance Program Retailers authorized to accept SNAP must honor this rule and cannot add tax to eligible food transactions made with EBT cards.2Food and Nutrition Service, U.S. Department of Agriculture. SNAP Retailer Notice – EBT Authorized Retailers Must Comply with the SNAP Equal Treatment Rule WIC purchases follow a similar pattern. Pay with cash in a state that taxes groceries and you owe the tax; pay for the same item with SNAP benefits and you don’t.
Prescription Drugs and Medical Supplies
Prescription medications are exempt in virtually every state. The exemption usually covers any drug dispensed by a licensed practitioner for human use, along with insulin (which does not always require a prescription), hypodermic needles, and syringes. Prosthetic devices, corrective lenses, hearing aids, hospital beds, and durable medical equipment like wheelchairs and oxygen delivery systems are also exempt in most states. Blood glucose test strips and wound care dressings round out the common list.
Over-the-counter medications are treated very differently. Pain relievers, antacids, and cold medicine are taxed in the large majority of states. Roughly ten states and the District of Columbia exempt OTC drugs, but everywhere else you pay full sales tax on anything you can grab off the shelf without a doctor’s order. A few states tax prescription drugs at a reduced rate rather than exempting them outright, though that approach is rare.
Veterinary prescriptions get inconsistent treatment. Some states extend the prescription drug exemption to medications dispensed by a licensed veterinarian for animals; others limit it to drugs prescribed for human use. Whether you owe tax on your pet’s antibiotic depends entirely on your state’s code.
Menstrual Products
Menstrual products have been one of the fastest-moving areas of sales tax policy. As of mid-2025, roughly 32 states either specifically exempt tampons and pads or have no sales tax to begin with. That leaves about 18 states still charging full sales tax on these products. The pace has picked up sharply since 2016, and nine states repealed their so-called “tampon tax” in 2021 and 2022 alone. If your state still taxes these items, check recent legislation before assuming it still does; new exemptions pass nearly every session.
Clothing and Footwear
Clothing exemptions are narrower than most people assume. Only a handful of states fully exempt everyday clothing and footwear. A few others exempt clothing below a per-item price cap, which ranges from about $100 to $250 depending on the state. In cap states, each item is evaluated on its own: buy five shirts at $90 each and all five are exempt, even though the total exceeds the cap. Buy one jacket at $300 and the whole price is taxable, not just the amount over the threshold.
Even in states with broad clothing exemptions, some items are almost always excluded. Fur garments, costume jewelry, and sports equipment designed for a specific activity, such as cleats, helmets, and pads, are typically taxed as specialty or luxury goods rather than everyday apparel. The distinction usually comes down to whether an item is worn as ordinary clothing or serves as equipment for a particular purpose.
Textbooks and Educational Materials
A number of states exempt textbooks required for coursework, and the exemption usually applies wherever the student buys the book, whether that is a campus bookstore, an online retailer, or a used-book vendor. Some states have extended the break to digital textbooks and course-required software, but the treatment of digital educational materials is uneven. The same textbook can be tax-free in print and taxable as a download depending on how a state classifies electronic goods.
Farm and Manufacturing Equipment
Most states exempt machinery and equipment used directly in manufacturing. Only about eight still tax these business inputs at the full rate. Agricultural inputs get even broader protection: around 38 of the 45 states with a sales tax exempt farm equipment, and most also exempt consumable supplies like seed, fertilizer, and livestock feed. Tractors, combines, and irrigation systems typically qualify. Farmers usually have to give the supplier an exemption certificate documenting that the purchase is for agricultural use.
Purchases for Resale
If you buy goods specifically to resell them, you generally do not pay sales tax on that purchase. This is one of the most fundamental exemptions in any sales tax system: the tax is meant to fall on the final consumer, not on every link in the supply chain. A retailer buying inventory from a wholesaler presents a resale certificate instead of paying tax, then collects the tax when selling the item to the end customer.
The Multistate Tax Commission publishes a uniform resale certificate that is accepted in many states, and the Streamlined Sales Tax governing board offers its own exemption certificate accepted by all 24 of its member states.3Streamlined Sales Tax. Exemptions In most states, a single certificate can serve as blanket authorization covering all future purchases from the same vendor, so you don’t have to fill out new paperwork for every order. The seller keeps the certificate on file as proof that the sale was legitimately tax-free.
Government and Nonprofit Purchases
Federal and state government agencies are generally exempt from sales tax on direct purchases. The key word is direct. If a government employee pays out of pocket and gets reimbursed later, the purchase is usually taxable because the sale was technically made to the individual, not the agency. Purchases charged to a government-issued credit card tied to a centrally billed account typically qualify for the exemption.
Nonprofits are more complicated. Holding 501(c)(3) status from the IRS does not automatically exempt you from state sales tax. Most states require nonprofits to apply separately for a state-level exemption, and the scope of that exemption varies. Some states exempt all purchases tied to the organization’s charitable mission; others limit the break to specific categories of nonprofits like schools, food banks, or religious organizations. Assuming federal tax-exempt status carries over can produce an unpleasant bill during an audit.
Newspapers and Periodicals
Print newspapers and magazines published at regular intervals are exempt in many states. The exemption typically covers publications containing news, opinion, and matters of general public interest, not catalogs, advertising circulars, or promotional inserts.
Digital treatment is uneven. A state may exempt the print edition of a newspaper while taxing the digital version, or it may exempt digital news services only if the publisher also sells a print edition with identical content. If you subscribe to a digital-only outlet, check whether your state has specifically extended the exemption to electronic formats. Many have not.
Sales Tax Holidays
More than a dozen states hold temporary sales tax holidays each year, usually lasting two to three days, during which specific categories of goods can be purchased tax-free. The most common timing is late July or August, aimed at back-to-school shopping, though some states schedule separate holidays earlier in the year for emergency preparedness supplies or energy-efficient appliances.
The categories covered during these holidays typically include:
- Clothing and footwear, usually capped at $100 to $156 per item depending on the state.
- School supplies such as notebooks, pens, and pencils, often capped at $30 to $60 per item.
- Computers and tablets in several states, with caps ranging from $750 to $1,500.
- Emergency preparedness supplies like portable generators, batteries, flashlights, and storm shutters in states prone to severe weather.
- Energy-efficient products including ENERGY STAR appliances and WaterSense products in a smaller group of states.
Per-item price caps are the norm, and they apply to each individual item, not to the total purchase. If the cap on clothing is $100 and you buy three $80 shirts, all three are tax-free. Buy one $120 jacket, and the entire price is taxable; you don’t get the first $100 free. One state takes a broader approach, exempting most tangible personal property up to $2,500 per item during its holiday rather than limiting the break to specific categories. Exact dates and thresholds can shift year to year, so checking your state’s department of revenue website in the spring is the easiest way to plan.
How Exemptions Get Applied at the Register
For most consumer purchases, exemptions apply automatically. If you buy groceries in a state that exempts them, the register simply doesn’t add tax to those items. You don’t have to show anything or fill out a form. The same is true for clothing in states with apparel exemptions and for prescription drugs picked up at a pharmacy.
Business and organizational exemptions work differently. If you’re buying for resale, or purchasing supplies for a qualifying nonprofit, you have to give the seller a completed exemption certificate before or at the time of sale. The seller keeps it on file. If you forget to present it, the seller is required to charge you tax, and recovering it means filing a refund claim with your state’s tax authority, which is rarely quick.