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However, it is the states that have the right to impose any taxes other than those forbidden by the US Constitution and the state’s own constitution. Sales tax is one tax that states have the right to impose and some states across the US impose this tax.
In the US, states of Oregon, New Hampshire, Montana, Hawaii and Delaware have sales tax, and different counties within these states have their own local sales tax. These taxes are used for state highways, state public schools, state medical institution and other state services. However, sales is rather regressive in nature because all people pay the same percentage immaterial what their income is. This means that people with smaller incomes pay higher percentage of their income in sales tax compared to those with higher incomes.
The states that have sales tax charge have their own established rate and it varies from one state to another. This rate is inclusive of what the state determines along with local municipalities and this means that within the same state, sales tax can vary depending on where you live and shop.
The first sales tax was introduced in 1921 by way of a national sales tax of 1 percent to help pay the debt that occurred during World War I. However, this was later revoked but the first state sales tax went into effect in the same year when West Virginia passed a legislation for the tax.
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