Sales tax charges do not cover all types of goods and services. Some are exempted such as groceries and medications or clothing in some regions. Other exempted products and services are raw materials and non-profit items. To account for sales tax, businesses exclude a certain percentage from revenue. For example, if Mr.X a retailer, sells a product worth $200, based on the percentage in that state, Mr. X will add between $15-$20 as sales tax to make a total of $215 or $220. However, only $200 counts revenue.