Sales tax glossary
What is a taxability matrix?
A taxability matrix is a table that maps each product or service a business sells to its tax treatment in each jurisdiction, such as taxable, exempt or partially taxable. It's the reference a business, or its tax software, uses to decide whether to charge tax on each line item.
Example
A retailer's matrix shows that its clothing is taxable in one state, exempt in another, and exempt below a price cap in a third.
Why it matters for sellers
A matrix turns scattered state rules into decisions you can apply the same way every time. It needs updating whenever you add products or a state changes its rules.
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Related terms
This definition is general information, not tax or legal advice. Rules vary by jurisdiction and change over time.
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