You’re on vacation in New York and I guess you do not want to talk about sales tax, expenses… I understand perfectly! However, you must know that in the United States and especially in New York, prices appear without taxes. To avoid bad surprises when you get to the cashier, I’ll give you some advice.
Everything you need to know about sales tax, tips and little extra fees in New York City
├ What are the sales tax for goods and services in New York?
├ What are the tax rates for restaurants in New York?
├ What about for hotels?
What are the sales tax for goods and services in New York?
The State and the city of New York apply use tax and sales tax on services and goods. You must add 8.875% to the price tag:
– The City Sales Tax rate is 4.5%,
– NY State Sales and Use Tax is 4%,
– 0.375% of the Metropolitan Commuter Transportation District (MCTD – non applicable to clothing and footwear).
Some products are exempt to taxes. That is the case of food (except in restaurants and fast food), medicines, diapers, magazines and newspapers… but also clothing and accessories such as shoes that cost less than $ 110 per item.
– If a garment or a footwear costs $110 or more, the sales tax of 8.50% will be applied.
– If a garment or pair of shoes costs less than $110, the sale is free of taxes.
– If the total amount of purchases in a store is equal to or more than $110, as long as neither clothing nor footwear cost more than or equal to $110, no taxes apply.
– If the total amount of a purchase is greater than or equals $110, and if one of the garments or pair of shoes costs $110 per item, the purchase is subject to taxes.
What you can do:
– The best thing is to calculate the final price adding 10% mentally before you buy clothes of more than $110. It is easier to calculate 10% than 8.50% 😉
– Do not worry because taxes will appear on the receipt of your purchases.
– If the total amount is more expensive than you thought, you can always return your purchase unless there is a notice that says otherwise in the store (with underwear for example).
Now you are ready for a shopping spree in New York City!
What are the tax rates for restaurants in New York?
Restaurants, cafes and fast foods are “services”. Then the tax rates are 8.875%.
In addition, to calculate the tip, you need to consider the total price of your consumption and add a percentage depending on your satisfaction with the service received. In general, tips are indicated on the receipt.
For instance, give 10 to 12% tip for a regular service, 15 to 18% tip for a good service, 20% or more if the service has been more than perfect.
At fast-food or take-away restaurants, you do not have to leave a tip.
What about for hotels?
When looking for a hotel on the Internet, it is important to know if the price that appears includes taxes or not. For example, on Expedia, the prices displayed include tax. However, if you book on Booking.com, the total price appears after you select the hotel, but before paying (there is no cheating).
The hotels and hostels charge 14.75% + $ 3.50 / night / room.
Finally, check if the hotel has “resort fee“. They correspond to the amenities of the hotel, like a fitness room, a pool, Internet access… You must pay even if you don’t use them!
Eventually, don’t forget to leave a tip for the people who help you at the hotel during your stay! If the doorman calls a taxi, you can give $1; $1 to $2 to the person who takes your bags to the room; $1 to $2 per day for the cleaning lady. And as for the restaurant, if the service is exceptional, you can give more.
Now you know everything about the taxes that apply in New York! Then, there will be no surprises when it comes to paying at stores. On the other hand, your biggest problem will be organizing your new purchases in your suitcase! 😀
Finally, know that it is no longer possible to ask for tax refund at the airport before returning to your country. Be aware that you’re purchases abroad may be subject to taxes in your country of origin.
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