State and Local Taxing Trends you Should Know About

As numerous state and local government agencies struggle with their budgets, many have taken to new taxes, or tax increases to makeup for lost revenue. Whenever a state is able to collect a decent amount of funds because of a new tax law change, other government agencies are quick to notice and enact a similar tax increase of their own.

Sin Taxes

Taxes levied on cigarettes and other tobacco products, commonly referred to as "sin taxes," also include taxes on other products that legislators consider bad for your health such as alcohol or sugary beverages. In addition to tobacco taxes, you are likely going to see other sin tax increases. The federal government has helped start this trend with their new tanning tax, and the state of NY already considered a soda tax (although lobbyists successfully defeated this new tax).

Amnesty Programs

Although not a new tax increase, local amnesty programs are something you should be aware of. The city of Philadelphia recently executed an unpaid tax amnesty program, where delinquent taxpayers could pay the taxes they owed, and only half of the interest that would normally be due. Philadelphia's program was extremely successful - estimates predict around $25 million in additional revenue for the city - and because of its success you can bet that other state and local taxing agencies will launch amnesty programs of their own.

Digital, Non-Tangible Property

One of the largest trends in state sales tax laws is likely to be on digital, non-tangible property. Historically, excise taxes are only levied on tangible property, but as the need for tangible products diminishes, local governments are expected to begin charging a tax on electronic transmissions. Therefore, when you go to purchase a game, mobile app, or even an Mp3 on iTunes, you might have to pay a local sales tax. Most states have sales tax laws that were written long before today's "digital age," and legislators are looking for ways to generate revenue from digital sales.

The "Amazon Tax"

In 2008 the state of New York implemented an "Amazon Tax," which targeted out-of-state retailers such as Amazon.com and Overstock.com. Both popular online retailers actually challenged the tax law, but the courts sided with New York. The result was a tax on in-state businesses that show ads linking to a retailer's site, and has supposedly generated additional revenue for the state. As such, other states including California, Connecticut, Maryland, North Carolina, and Tennessee are considering similar tax laws.

The Tax Lady Roni Deutch and her law firm Roni Deutch, A Professional Tax Corporation have been helping taxpayers across the nation find IRS tax relief for over seventeen years. The firm has experienced tax lawyers who can fight IRS tax liens on your behalf.