Market Overview

New Sales Tax Report Shows a Decrease in Rate Changes in First Half of 2018

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Annual Vertex Study Details Notable State Sales Tax Statistics

According to the annual mid-year tax rate study issued by Vertex
Inc.
, a leading provider of tax technology and services, there were
318 sales tax rate changes in the first six months of 2018, a decrease
from the same period in 2017. In addition, over the past 10 years there
have been 6,414 new and changed sales and use tax rates.

"Although sales and use tax rate changes decreased from previous years,
it was still an extremely active and surprising six months as tax
professionals began to watch and assess the implications of the Supreme
Court's South Dakota v. Wayfair decision," said Bernadette
Pinamont, Vertex vice president of tax research. "As a result of Wayfair,
tax professionals are putting a greater focus on reviewing their
end-to-end sales and use tax compliance processes, specifically
registrations and exemption certificate management. Wayfair is not
only impacting their economic nexus, but is also prompting companies to
discuss processes, staffing and technology resources needed for tax."

The Vertex 2018 Mid-Year Sales Tax Rate Report lists two state sales tax
changes during the first half of 2018:

  • Effective January 1, 2018, New Jersey decreased their rate from 6.875%
    to 6.625%.
  • Guam has increased their Business Privilege Tax from 4.000% to 5.000%,
    effective April 1, 2018.

Additionally, the combined national sales tax rates average increased
slightly to 10.0361 percent, up from 9.9819 percent in 2017.

  • Puerto Rico currently has the highest state sales tax rate at 10.50
    percent with an additional one percent local rate that applies
    throughout the Commonwealth to make it 11.50 percent.
  • Indiana, Mississippi, Rhode Island and Tennessee have the second
    highest state sales tax rate at 7.00 percent.
  • Kodiak, Nome and Wrangell, all in Alaska, and Winter Park, CO have the
    highest city sales tax rate at 7.00 percent. Hoonah and Selawik, both
    in Alaska, have the second highest rate of 6.50 percent.
  • Tuba City (including the surrounding areas that are in the
    To'Nanees'Dizi Local Government), Coconino County, AZ has the highest
    combined sales tax rate of 12.90 percent.

The report highlights ever-changing and varying sales tax rates across
jurisdictions. In the last 10 years in the U.S. there have been:

  • 2,319 new sales and use taxes, an average of 220 per year;
  • 4,095 sales and use tax changes, an average of 390 per year; and
  • 6,414 new and changed sales and use tax rates, an average of 610 per
    year.

To receive a copy of the full report outlining all sales and use tax
rate changes for the first half of 2018, please contact: Tricia
Schafer-Petrecz at tricia.schafer-petrecz@vertexinc.com
or 484-595-6142.

About Vertex

Vertex,
Inc.
is 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.

For more information about Vertex, visit www.vertexinc.com
or follow Vertex on Twitter @vertexinc.

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