You could say that sales taxes are the one tax that truly affects every person – it’s the classic consumption tax. It is also the one politicians often reach for to ratchet-up for their favorite pet project. That being said, the folks over at the Tax Foundation recently put together some numbers showing combined sales tax rates (state & local where applicable) for each state. Interestingly, there are five states that do not have a state sales tax and there are some with a sales tax but no income tax. It all adds up and it certainly helps determine an area’s cost of living – especially when it is applied to a broad range of goods and services.
“Retail sales taxes are one of the more transparent ways to collect tax revenue. While graduated income tax rates and brackets are complex and confusing to many taxpayers, sales taxes are easier to understand; consumers can see their tax burden printed directly on their receipts.”