According to Vertex Inc.’s annual Sales Tax Rate Report, the average number of U.S. sales tax rate changes per year has grown by 28 percent since the late 1990s.Based on a comparison of the number of state, county, city and district sales tax rate changes during the six-year periods between 1995 and 2000, and 2001 and 2006, the study found that the average number of rate changes per year was 610 and 779, respectively. According to the report, the number of rate changes decreased for the earlier period, while the number of yearly rate changes fluctuated for the later period.
"As the economy was flush with money in the late ‘90s, there is a recognized decrease in the number of tax rate changes from 1995-2000," said Vertex vice president of tax content development John Minassian, in a statement. "However, ever since predictions of an economic bubble burst came to fruition in 2000, we have seen a severe increase in the number of rate changes, likely the result of local, city, county and state needs to increase revenue and balance budgets."
Vertex said that it remains to be seen how much participation in the Streamlined Sales Tax Project has directly influenced the year-over-year increase in the total number of rate changes at the local, county and city levels.
The report also revealed that the average U.S. sales tax rate hit a historical high in 2006 at 8.579 percent, up from 8.549 percent in 2005.
The complete report is available at www.vertexinc.com.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access