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Posted on 05/23/2008 9:27:29 AM PDT by K-oneTexas
U.S. Cities Increasing Sales Taxes in Record Fashion
Over 450 cities increase sales taxes in 2007.
by John Minassian
According to the recently released Vertex Sales Tax Rate Report, 485 U.S. cities increased their sales tax rate in 2007, representing the largest annual expansion in the number of cities that either increased their existing rates or initiated sales taxes in the past four years.
Last year, 178 cities nationwide initiated new city tax rates, while 307 cities increased their pre-existing sales tax rates. Of these, North Courtland, Ala., had the largest increase, to a four percent sales tax rate from one percent. Seldovia, Alaska experienced the second largest increase to 4.5 percent from two percent. Fredonia, Ariz. and Watts, Okla. followed, doubling to four percent from two percent.
Several large U.S. cities also raised their sales tax rates in 2007 — Boulder, Colo.; Phoenix, Ariz.; St. Louis, Mo.; Denver, Colo. and Seattle, Wash. — all increased rates between 0.1 percent and 0.2 percent.
The report also found that:
Colorado, Missouri, Texas and Washington experienced the highest number of city rate increases.
Only one state, South Carolina, raised its state-wide sales tax rate.
Catawba Indian Reservation, South Carolina and Wrangell, Alaska have the highest city sales tax rate at 7.0 percent.
Overall, the report found that 2007 sales tax rates remained higher than any previous year among those cities increasing an existing rate, illustrating an overall steady growth in the combined state, county and city average rates since 1981 (the year in which Vertex first began tracking data). However, the average U.S. sales tax rate among all taxing cities decreased slightly, from 8.579 percent in 2006 to 8.573 percent in 2007, the result of cities initiating lower rates on first-time taxes.
With more than 450 cities raising sales tax rates last year many local governments see sales tax revenue as a viable part of the solution in addressing revenue shortfalls. It is especially critical for corporate taxpayers to stay abreast of these sales tax rate adjustments and keep close records of all their transactions in order to remain in compliance and be prepared for potential state audits.
John Minassian is Vice President of Tax Research, Vertex, Inc. Over the last 30 years Minassian has held various jobs in the management of the accounting, finance and tax functions of large multinational companies including E.I. DuPont de Nemours, ICI Americas and AMP Inc. (now Tyco Electronics). He did his undergraduate work at the University of Pennsylvania, earned an MBA from Drexel University and his Masters in Taxation from Villanova University.
Attacked by government from all sides and all levels ... on every aspect of what the citizen does.
The only hope is taxation reform ...radical taxation reform in needed. Coupled with radical spending reform at all levels.
If this keeps up we really will have an economic recession. Then the liberals can use it to elect Obama or Clintoon and make it look like it's the fault of republicans.
When I was growing up I waw told that government jobs, by and large, are for complete slugs. It’s unbelievable how much mid-level gov’t employees are paid. It’s a pure celebration of utter mediocrity.
People are deserting these cities and so their tax base is evaporating as those who are left are on some form of social assistance or on city gov’t payroll.
This will just drive more people away.
How do you fight this stuff?
Our man Mitch just bumped our state sales tax up to 7 percent! Thanks, “Republicans!”
My city is floating out the concept of raising the sales tax and reducing the property tax. However, we all know that they will artificially inflate the value of the property in order to recover that.
The cumulative and incremental increases in taxes are hurting us all.
I wonder how much the average household pays in total taxes? We know federal tax rates are from 15% to 28% I think it is, on wages and salaries? Then you have to add in 7.65% FICA withheld, and also your employer pays that same 7.65% on your behalf. Then there are proerty taxes, sales taxes (in some cases, states and local gov’ts have their own sales taxes), state gasoline tax, federal gasoline tax, and so on.
Then, any retail purchase you make involve hidden taxes. Any taxes imposed on the business you are buying from is a cost of doing business for that company. So the retail price of whatever you buy is higher because of the business passing along their costs to the customer.
The total burden on the economy of taxes and government regulation is probably much higher than we think.
What is the sales tax rate in Seattle now? Here in the Tri-Cities we pay 8.3% and it has been this rate for quite a while now.
See... there’s at least ONE advantage to living in Oregon. (No sales tax)
I was looking at the new "destination-based" sales tax tables for my boss last week. It's 9.0% for large portions of the Eastside and Seattle.
Federal Taxes : Income Tax, Capital Gains Tax, AMT, Inheritance Tax, Excise Taxes, Gasoline and other Fuels Tax, Self Employment Taxes, Social Security/FICA, Medicare and more.
State Tax: Income, Sale & Use, Fuels, Oil/NG Production, Corporate Franchise, and more. (Texas has upwards of 40 taxes and fees.)
Seven states have no state income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Two others, New Hampshire and Tennessee, tax only dividend and interest income. See listing of individual income tax rates for 2006.
Five states have no state sales tax:The Sales Tax Clearinghouse notes that Alaska, Delaware, Montana, New Hampshire, and Oregon have no state sales tax. In addition, many states have excise taxes levied against specific products.
Benjamin Franklin uttered the famous bon mot, "Nothing in life is certain but death and taxes." That saying still rings true -- even in "tax free" states, the U.S. federal government wants to tax you, too. There is no escape. (http://ask.yahoo.com/20011231.html)
Well, no excape ... except radical tax reforn. Scrap the IRS Code and move to the Fair Tax.
http://www.fairtax.org/site/PageServer?pagename=about_faq_answers#25
Exactly what taxes are abolished?
The FairTax is replacement, not reform. It replaces federal income taxes including personal, estate, gift, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes.
How are state tax systems affected, and can states adequately collect a federal sales tax?
No state is required to repeal its income tax or piggyback its sales tax on the federal tax. All states have the opportunity to collect the FairTax; states will find it beneficial to conform their sales tax to the federal tax. Most states will probably choose to conform. It makes the administrative costs of businesses in that state much lower. The state is paid a one-quarter of one percent fee by the federal government to collect the tax. For states that already collect a sales tax, this fee proves generous. A state can choose not to collect the federal sales tax, and either outsource the collection to another state, or opt to have the federal government collect it directly. If a state chooses to conform to the federal tax base, they will raise the same amount of state sales tax with a lower tax rate -- in some cases more than 50 percent lower -- since the FairTax base is broader than their current tax base. States may also consider the reduction or elimination of property taxes by keeping their sales tax rate at or near where it is currently. Finally, conforming states that are part of the FairTax system will find collection of sales tax on Internet and mail-order retail sales greatly simplified.
http://www.fairtax.org/site/PageServer?pagename=about_ask_expert
How does the FairTax affect illegal immigration?
The FairTax will, for the first time, tax undocumented workers who now evade U.S. income and payroll taxes. Under the FairTax, all persons living in the U.S. pay taxes, whether they are here legally or illegally. [My addition: Everybody pays, even touists pay in to social security and medicare funds.] [ view full answer ]
Does the FairTax tax used items?
The FairTax does not tax “used” goods but it is important to note that HR25 has a legal definition of the term “used”. This is necessary to ensure that items are taxed only once and to prevent tax cheating. [ view full answer ]
More interesting reading:
Purchasing Power - The Forgotten Factor
May 2, 2008 - The Fair Tax Blog
485 cities. sniff sniff,, collusion.. cough
It has been said that sales taxes are coming. They are easier to administer and harder to cheat.
Trouble is, we need to get rid of the income tax!!!!!!!!
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