Sales tax increases are another reason to be frugal

Last week, the state where I live (North Carolina) increased its sales tax from 4.5% to 5.5%. With local taxes, that means our total sales tax has increased from 6.75% to 7.75%. A 1% increase may not seem like a lot, but it can add up for big purchases. On a $1000 purchase, that’s an extra $10 tacked onto your total cost.

I’m not sweating it, though. Paying less money in sales tax is just another perk of frugality. Here’s why:

I don’t buy a lot of stuff.

Since we live frugally, we just don’t make a lot of purchases that are subject to sales tax. Most of our expendable income goes to groceries, which is subject to a 2% sales tax in North Carolina. Our budget only includes about $100 a month for entertainment and household expenses like toilet paper and cleaning supplies. That means at most we’ll be paying an extra $1 a month with the increase.

Secondhand items are usually subject to 0% sales tax.

When a friend or family member gives you a piece of furniture or other item, guess how much sales tax you pay? 0%. The same is true if you shop at garage sales or Craigslist. In some states, you don’t even pay sales tax at thrift stores, particularly if they’re affiliated with a church.

If you’re worried about sales tax increases, think about ways you can live more frugally overall. After all, the less you spend, the less you pay in taxes.

4 thoughts on “Sales tax increases are another reason to be frugal

  1. Melanie

    Good post. We’re near Charlotte, where the sales tax is now over 8%. It’s crazy. We try to stick to Union County for our purchases, not just to avoid the sales tax, but also to support our own community. Online purchasing is also a great idea…another good thing is that, with sites like Amazon, if you spend enough at one time, your items may be eligible for free shipping, which saves you even more! Thanks for the post!

  2. Kacie

    Oh, taxes.

    Here in Allegheny County, it’s 7%, but in surrounding counties it’s 6%. I’m fairly close to another county, so if I go to Sam’s Club or Target, I’m going to go to the other county for the tax savings. It’s pretty much an equal drive to the Sam’s & Target in my county, so why not?

    Also, here in PA there’s no sales tax on clothing. Hellsyah!

    Supposedly, you’re supposed to pay sales tax on online purchases somehow, but I have no idea how that would even work. Whatever.
    .-= Kacie´s last blog ..My bank failed me =-.

  3. Jess

    It’s so crazy how much sales tax varies from state to state. In California, it jumped from 8.25 to 9.25% in a year. Plus, in the recent months, it’s now up to 9.75% so it definitely reminds me to be more cautious of my purchases. Since sales tax here applies to almost everything, the cheaper deals aren’t all that cheap once you factor in the sales tax. Btw, love your site!

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