4% in NYS but 8.38% in NYC which includes Manhattan, Brooklyn, Queens, Bronx, Staten Island and surrounding areas. I've prepared Sales & Use Taxes for my employer and it is very specific as to how much every locality pays. DVDs & CDs bought in a physical retail location in NY are taxed as anything else, DVDs & CDs bought online from Target, Best Buy or whatever are taxed as well. Amazon & Newegg are exempt as they have no physical presence via either store, warehouse or office, but if you buy from Amazon and the vendor is Target, you have to pay tax and thats normal. If you buy from Itunes you do not get taxed because there is no physical entity called Itunes in NYS. The language in law is very vague at times which opens up another can of worms, it says that you should claim items purchased out of state but it does not say that you have to. Does it apply to streaming? Netflix subscriptions are already taxed and so are XBOX Live cards and points. They will have to create a law that specifically states that all NYS residents who purchase downloaded items from anywhere in the world have to pay a tax to NYS and I seriously doubt that they have any power and will to do it. People buy things online to save money, period. Taxing "downloads" will deter people from buying and foster more "illegal" activity, so nobody wins. It's very hard to compel someone to buy from a store when you can buy it for 20-30% cheaper online with free shipping. I've lived in NYC for most of my life and I can tell you that it is arguably the most corrupt, you really have to pay to play. The more important question is how does a financial capital such as NY not have any money and then wants to nickel and dime everything to make up for lost revenue?