Prescription Drugs Mostly Tax-Free, But OTC Medications Face Varied Sales Tax Rules Across States

• Prescription medications are generally exempt from sales tax in most states.
• Illinois is the only state with a statewide sales tax that imposes a 1 percent tax on prescriptions.
• Local sales taxes may still apply to prescriptions in some areas, such as certain parishes in Louisiana.
• In Alaska, municipalities like Anchorage exempt prescription drugs from local sales tax.
• Non-prescription or over-the-counter (OTC) drugs may be exempt from sales tax in some states.
• States that exempt certain OTC drugs include Florida, Maryland, Connecticut, New York, Vermont, Minnesota, Virginia, Pennsylvania, New Jersey, Texas, and the District of Columbia.
• OTC drugs may become tax-exempt if prescribed by a doctor in some states.
• There is a push for OTC drugs to receive the same tax-free status as prescription medications.

Source: taxconnex.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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