Sales Tax (and Why Walmart Has Two Lines)

Sales tax is a consumption tax levied by state, county, and (in some places) city governments on retail purchases. The combined rate varies dramatically: Alaska has no state sales tax in most areas; California averages 8.85%; Tennessee combines for ~9.55% in some cities.

On receipts, sales tax appears as a separate line near the bottom: "TAX: $X.XX" or "STATE TAX 6.000% on $50.00 = $3.00". Some retailers itemize state and local tax separately.

Many states tax different categories at different rates. Walmart famously prints two tax lines — "TAX 1" (typically general merchandise at the full rate) and "TAX 2" (typically food/grocery at a reduced rate or 0%). Each line item carries a tax flag (T = taxable, N = non-taxable, X = exempt) so the POS knows which bucket it belongs to.

For receipt accuracy: don’t apply a single flat tax to a Walmart grocery receipt. The math will be wrong.