Sales Tax in the United States of America As an Example of Consumption Tax
Consumption taxes are widely applied in the world today, especially the value-added tax (VAT). While the United States (USA), has no general VAT system, it does have a sales tax similar to VAT. Sales tax is a tax levied on certain goods and services in the last stage of consumption at checkout. The...
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| Main Author: | |
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| Format: | Article |
| Language: | English |
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Istanbul University Press
2023-11-01
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| Series: | Maliye Çalışmaları Dergisi |
| Subjects: | |
| Online Access: | https://cdn.istanbul.edu.tr/file/JTA6CLJ8T5/D2B45305E3064227975742F1EAE59653 |
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| Summary: | Consumption taxes are widely applied in the world today, especially the value-added tax (VAT). While the United States (USA), has no general VAT system, it does have a sales tax similar to VAT. Sales tax is a tax levied on certain goods and services in the last stage of consumption at checkout. The purpose of sales tax is the taxation of goods and services other than luxury consumer goods and general necessities. The sales tax is considered complex in this respect; yet draws attention in terms of being applied at very low rates when compared to consumption taxes worldwide. As a matter of fact, the ratio of consumption taxes to total tax revenues in the USA remains at a very low level compared to other OECD countries, like Türkiye, due to the broad lists of sales tax exemption and very low tax rates. This study, examines sales tax in terms of basic characteristics, before providing a detailed evaluation of taxable goods and services, rate structure and tax expenditures for the state of California, which has the highest sales tax rate and finally making some suggestions through comparisons within the framework of issues such as the ratio of consumption tax to overall tax revenues and the proportional structure of VAT, as the most common consumption tax. |
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| ISSN: | 2757-6728 |