According to the yearly sales tax rate study issued today by Vertex Inc.,the leading provider of sales tax solutions and services, the number of sales and use tax rate changes in the U.S. for year 2013 was 609, up significantly from 2012 when there were 463 changes.
“While there were significantly more changes in 2013 than the previous few years, the number is still well below the amount of changes between 2004 and 2009,” said John Minassian, Vice President of Tax Content Development for Vertex Inc. “The increase in the rate of change may signal states attempting to adjust their tax revenues to meet their budgetary needs. In some instances jurisdictions may have elected to give some revenue back to the public through rate reductions because the ir budgets have been balanced. For the first time in five years, other jurisdictions still struggling with budget issues or with newinitiatives to fund; elected to increase rates.”
During 2013 there were eight state level rate changes. Five states increased their state level rates and three decreased them:
California increased its rate to 6.500% from 6.250%
Arkansas increased its rate to 6.500% from 6.000%
Virginia increased its rate to 4.300% from 4.000%
Ohio increased its rate to 5.750% from 5.500%
Maine increased its rate to 5.500% from 5.000%
Arizona decreased its rate to 5.600% from 6.600%
Kansas decreased its rate to 6.150% from 6.300%
District of Columbia decreased its rate to 5.750% from 6.000%.
“Ensuring tax compliance in light of these constant changes continues to be a concern for companies of all sizes. Sales and use taxes continue to be scrutinized by auditors at the state and local levels, while companies continue to seek tax process and technology improvements to help manage continued compliance demands,” said Peggi Rockefeller, Chief Tax Officer, U.S. Transaction Tax for Vertex Inc.
Additional statistics from the Vertex 2013 Sales Tax Rate Report include:
The average state level sales tax rate increased to 5.4964% from 5.4880% in 2013.
Indiana, Mississippi, New Jersey, Rhode Island and Tennessee have the highest sales tax rates at 7.000%. Minnesota has the second highest sales tax rate at 6.8750%.
The average county tax rate is marginally higher than the year-end 2012 rate at 1.5660%, and the average city rate increased to 1.6895% from the year-end 2012 rate of 1.6751%.
The highest city sales tax rates are found in Kodiak, Alaska, and Wrangell, Alaska (both 7.000%).
The highest combined sales tax rate of 12.7250% is found in Tuba City (including the surrounding areas that are in the To’Nanees ‘Dizi Local Government), Coconino County, and Arizona.
The average combined sales tax rate (including special purpose tax districts) is 9.6917%, up slightly from the 2012 year-end rate of 9.6144%
Since 1978, Vertex, Inc., has been a leading provider of tax technology and services, enabling companies of all sizes to realize the full strategic potential of the tax function by automating and integrating tax processes, while leveraging advanced and predictive analytics of tax data. Vertex provides cloud-based and on-premise solutions that can be tailored to specific industries for every major line of tax, including income, sales and consumer use, value added and payroll. Headquartered in Pennsylvania, and with offices worldwide, Vertex is a privately held company that employs over 900 professionals and serves companies across the globe.