August 6, 2014
Sales Tax Burden Holds Steady for U.S. Consumers and Businesses in Q2 2014
New York - The U.S. sales tax burden was unchanged in the second quarter of 2014, according to the latest ONESOURCE Indirect Tax rate report from Thomson Reuters.
“We are clearly in the midst of a stabilizing trend for domestic tax rates,” said Bernadette Sablan, Director of Tax Research and Content at Thomson Reuters.
Thomson Reuters quarterly ONESOURCE Indirect Tax rate report summarizes changes in sales, use and value added taxes. In Q2 2014, state rates remained at an average 5.457 percent for the third straight quarter, allowing the overall average burden to remain at 8.467 in Q2 2014.
In addition, there were 199 changes made to U.S. tax codes, down slightly from 211 changes in Q1 2014.
“A couple hundred code changes every quarter is a continuing challenge for businesses to manage,” Sablan said. “It’s critical for them to be diligent about their compliance.”
The average city rate stayed flat at 1.76 percent, and the average county rate rose negligibly from 1.243 percent to 1.25 percent. Indiana, Mississippi, New Jersey, Rhode Island, and Tennessee once again tied for the highest state designated portion of the sales tax rate at 7 percent, while an Alaskan county (Wrangell) and city (Kodiak) topped their respective lists with a 7 percent designated portion of the rate as well.
Internationally, China expanded VAT treatment to the telecommunications sector, sending the applicable rates to 11 percent for basic telecommunications services and 6 percent for value-added telecommunications services. Additionally, the state of Andhra Pradesh was divided into two states, Telangana and Andhra Pradesh. As a result, the existent VAT law will apply to both states until the new government makes modifications to the law. The VAT standard rate is 14.5 percent; reduced rates are 5 percent and 1 percent.
To download the full report, visit https://tax.thomsonreuters.com/reports/indirect-tax-rates/2014_q2. Past reports can be viewed at https://tax.thomsonreuters.com/reports/indirect-tax-rates/.
For more information on ONESOURCE Indirect Tax, visit https://tax.thomsonreuters.com/products/brands/onesource/indirect-tax/.
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