Sales tax

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Sales tax

A percentage tax on the selling price of goods and services.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Sales Tax

A tax imposed on the sale of retail goods and services. That is, the government collects a certain percentage of the sale price on transactions where goods and services are traded at the retail level. While the retailers are responsible for paying the sales tax, most of the time they simply pass on the cost to customers. For example, if an item costs $10 and there is a 5% sales tax, the retailer will charge the customer $10.50. Proponents of sales taxes argue that they reward those who spend less and, therefore, do not punish those who earn more. Critics argue that sales taxes harm the poor disproportionately and can drive business to other jurisdictions. See also: VAT, Regressive tax.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

Sales tax.

A sales tax is a tax imposed by state and local governments on transactions that occur within their jurisdictions.

The taxing authority determines which transactions are subject to tax and the flat rate at which the tax is calculated. Some countries, though not the United States, impose a national sales tax often called a value added tax (VAT).

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

sales tax


turnover tax

a form of INDIRECT TAX that is incorporated into the selling price of a product and is borne by the consumer. Sales taxes include VALUE-ADDED TAX and EXCISE DUTY.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
Compare and contrast the flat tax and national sales tax systems as applied to individuals, using the principles of simplicity, transparency and minimum tax gap.
A national sales tax or a VAT, in contrast, would require the average price of consumer goods and services to rise relative to production costs and wages.
The National Governors Association is seeking a "21st century sales tax," essentially a national sales tax, where companies would collect sales tax on every purchase and remit it to the state where the purchaser resides.
Some have charged the Republican Congress with hypocrisy for promoting radical, supposed "tax simplification" measures like the flat tax or a national sales tax while at the same time pushing huge new complexifications like the tax act.
* Federal tax reform A national sales tax or a flat national income tax would force substantial change and conformity on state taxes.
Burton, predict a far healthier economy if the current tax system were replaced with a national sales tax. Such a tax, Burton argues, would reward individual decisions to work, save, and invest, while the current law favors consumption of goods and services.
Individual and business income taxes would be replaced with either a national sales tax, or its close cousin, the value-added tax.
Bill Archer (R-Tex.), hasn't taken a specific position on not-for-profit tax issues, but he is known to favor a national sales tax as a substitute for the income tax (obviously, this would eliminate charitable deductions, and although such a radical overhaul doesn't stand a snowball's chance in passing, it does characterize Archer's sympathies).
All things considered, a flatter and simpler income tax system that retains preferences for housing was ranked first, followed by a consumption tax or national sales tax that does not tax spending on housing.
As an added bonus, a national sales tax would get at the underground economy.
The National Retail Association is opposed to the idea of a 17 percent national sales tax. The organization is still studying the flat tax idea.
Then there's choice number three: the national sales tax. This is a sweeping plan to wipe away the current system and replace it with an unprecedented federal tax on retail purchases.

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