In short: Adding tax is easy: multiply. Removing tax from a sticker price is where everyone slips, because 20% VAT inside a $120 price is $20, not $24. This calculator does both directions so freelancers, sellers, and travelers get the real numbers.
Updated August 28, 2026, after a fresh review, with updated visuals and links.
Add it or strip it, without the classic mistake
Add mode: price before tax times (1 + rate). $100 at 8% becomes $108, with $8 of tax. Straightforward, no surprises.
Remove mode is the trick: the tax-included price does not shrink by rate%. To strip 20% VAT from $120, divide by 1.20: the net is $100 and the tax inside was $20. Subtracting 20% of 120 ($24) would overstate the tax by a fifth.
That mistake matters when expensing business purchases abroad or pricing products from a tax-inclusive retail price. The widget labels both numbers explicitly, so the gross, the net, and the tax itself are never ambiguous.
Worth remembering
- In the US, sales tax often varies by city, not just state; receipts show the exact rate if you need to reverse it later.
- EU prices shown to consumers already include VAT; the remove mode is what exporters use to compute the pre-tax price for B2B invoices.
Frequently asked
What is the difference between sales tax and VAT?
Sales tax is charged once at the final sale and varies by US locality; VAT is charged at each production stage and is baked into consumer prices in most of the world. The percentage math of adding or removing either is identical.
Can I compound two taxes, like state plus city?
US stacked taxes usually apply to the same base price, so just add the rates (6% state + 2% city = 8%). The rare tax-on-tax case multiplies, which the stacked-discount tool covers.
Find every related tool in our Money Tools: Every Free Calculator index.
