Vertex 2022 Sales Tax Rates and Rules Report: Decline in Rate Changes Belies Increases Across Most Jurisdictions
KING OF PRUSSIA, Pa., Jan. 24, 2023 (GLOBE NEWSWIRE) -- Vertex, Inc. (NASDAQ:VERX) (“Vertex” or the “Company), a global provider of tax technology solutions, released its annual End-of-Year Sales Tax Rates and Rules report, which found that while the total number of transaction tax changes across the U.S. declined, most jurisdiction categories actually continued to see rate increases.
The overall number of sales tax rates and rules changes appears to have reached the lowest level in eight years with 542 changes at the state, county, city and district levels. But that total is skewed by a decline in only one category: new district taxes. After a five-year stretch during which an average of 180 new district-level taxes were created each year, that number declined to 115 this year.
Even though fewer districts were created in 2022, the increases to existing district tax rates outnumbered decreases by a ratio of three to one. Additionally, rate changes at other levels of government including city, state and local remained at record highs similar to the last few years. The county level posted a three-year high in 2022. And city rate changes remained at near all-time highs, matching their most recent five-year average.
“Sales tax rates will continue to increase. Governments need to fill budget gaps as Federal COVID-related funding will begin to run dry, as borrowing becomes more expensive and overall inflationary pressures on labor, services and consumables continue,” said Vertex Vice President of Tax Content and Chief Tax Officer Michael Bernard. “On top of these economic factors, sales tax is generally more efficient to impose and administer relative to property and income taxes, making it a more resilient revenue source for governments, particularly in times of economic distress.”
Beyond the broad numbers, the 2022 report showed several other interesting trends, including:
- Tax policy, economic conditions and fiscal conditions remain intertwined.
Although inflation tends to be headed downward, it remains high and unlikely to return to pre-2022 levels any time soon. Many economists also assign a high probability to a U.S. recession, even a moderate one, occurring this year. As high debt-servicing costs sustain or increase, state and sub-state jurisdictions will need to pull other levers to satisfy revenue needs amid higher prices and labor costs.
- Income tax and property tax revenue declines also drive sales tax changes.
State legislature activity and 2022 ballot initiatives showed a growing desire to limit income tax rate increases, in some cases, lowering income tax rates and reducing property taxes. Home values in many markets have levelled off or declined since mid-2022. Commercial office space values are also declining due to permanent, hybrid work models. This will result in lower property tax receipts in 2023 and beyond. Property taxes, income taxes, and sale and use taxes represent the top three funding sources for state and local governments, therefore more sales tax rate changes loom.
- If a recession arrives, tax leaders should be aware of the lag between economic conditions and city fiscal conditions.
This delay can last 18 months to several years, according to the National League of Cities (NLC), and according to their research it takes 18-24 months for the effects of changing economic conditions to become evident in city budgets.
- The shrinking sales tax base may spark new legislative approaches.
The sales tax base has shrunk significantly in the past two decades. State sales tax bases “are narrowing,” according to the Tax Foundation, “forcing states to either raise rates or shift to other sources of tax revenue in response to this continuous erosion.” These sources already include a growing number of digital taxes, and could soon extend to professional services, such as accounting and other business-to-business offerings.
- Post-Wayfair sales taxes are attracting federal attention.
Two months ago, the General Accounting Office (GAO) encouraged Congress to work with states “to establish nationwide parameters for state taxation of remote sales” for several reasons, including the headaches remote sellers experience while trying to comply with “a complex patchwork of requirements … governing the taxation of remote sales.” In June of last year, the U.S. Senate Finance committee hosted a committee hearing to examine the impact of the South Dakota v. Wayfair decision on small business and remote sellers.
For the Vertex End-of-Year Sales Tax Rates and Rules Report for 2022, click here.
Vertex, Inc. is a leading global provider of indirect tax software and solutions. The company’s mission is to deliver the most trusted tax technology enabling global businesses to transact, comply and grow with confidence. Vertex provides solutions that can be tailored to specific industries for major lines of indirect tax, including sales and consumer use, value added and payroll. Headquartered in North America, and with offices in South America and Europe, Vertex employs over 1,300 professionals and serves companies across the globe.
Copyright © 2023 Vertex, Inc. All rights reserved. The information contained herein is intended for information purposes only, may change at any time in the future, and is not legal or tax advice. The product direction and potential roadmap information is not a guarantee, may not be incorporated into any contract, and is not a commitment to deliver any material, code, or functionality. This information should not be relied upon in making purchasing, legal, or tax decisions. The development, release, and timing of any features or functionality described for Vertex's products remains at the sole discretion of Vertex, Inc. Any statements in this release that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to various risks and uncertainties described in Vertex's filings with the U.S. Securities and Exchange Commission ("SEC") that could cause actual results to differ materially from expectations. Vertex cautions readers not to place undue reliance on these forward-looking statements which Vertex has no obligation to update.
To view this piece of content from ml.globenewswire.com, please give your consent at the top of this page.
About GlobeNewswire by notified
One Liberty Plaza - 165 Broadway
NY 10006 New York
GlobeNewswire by notified is one of the world's largest newswire distribution networks, specializing in the delivery of corporate press releases financial disclosures and multimedia content to the media, investment community, individual investors and the general public.
Subscribe to releases from GlobeNewswire by notified
Subscribe to all the latest releases from GlobeNewswire by notified by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from GlobeNewswire by notified
Centessa Pharmaceuticals to Present Additional Data from Open-Label Extension (OLE) of Phase 2a Study of SerpinPC for Hemophilia at the 16th Annual Congress of the European Association for Haemophilia and Allied Disorders (EAHAD)6.2.2023 14:00:00 CET | Press release
BOSTON and LONDON, Feb. 06, 2023 (GLOBE NEWSWIRE) -- Centessa Pharmaceuticals plc (Nasdaq: CNTA), a clinical-stage pharmaceutical company that aims to discover and develop medicines that are transformational for patients, today announced that the Company will present additional data from the open-label extension (OLE) of AP-0101, a Phase 2a study of SerpinPC, a novel inhibitor of activated protein C (APC) being developed for the treatment of hemophilia, during an oral presentation at the 16th Annual Congress of the European Association for Haemophilia and Allied Disorders (EAHAD), on February 10, 2023. The Company recently announced positive results from the Phase 2a OLE at the 64th American Society of Hematology (ASH) Annual Meeting. “We are excited to share additional data from the OLE that further demonstrate the potential for SerpinPC to be a convenient subcutaneous treatment with a differentiated safety profile for people living with hemophilia,” said Saurabh Saha MD PhD, Chief Ex
Aktia’s Financial Statement Release 2023 will be published on Friday 17 February 2023 at 8.00 a.m.6.2.2023 14:00:00 CET | Press release
Aktia Bank Plc Press release 6 February 2023 at 03.00 p.m. Aktia’sFinancial Statement Release 2023 will be published on Friday17 February 2023 at 8.00 a.m. Aktia’s Financial Statement Release 2022 will be published on Friday 17 February 2023 at 8.00 a.m. (EET). The Financial Statement Release is available at Aktia’s website www.aktia.com after the publication. Webcast from the results event A live webcast will be sent from Aktia’s results event on Friday 17 February 2023 at 10.30 a.m. CEO Mikko Ayub and CFO Outi Henriksson will be presenting the results. The event will be held in English and can be seen live as a webcast or as a recording after the event at https://aktia.videosync.fi/2022-q4-results. The presentation material in English is available at Aktia’s website www.aktia.com before the results event. Aktia Bank Plc Further information: Lotta Borgström, Director, Investor Relations and Communications, tel. +358 10 247 6838, firstname.lastname@example.org Distribution: Nasdaq Helsinki L
Aktias bokslutskommuniké för år 2022 publiceras fredagen 17.2.2023 kl. 8.006.2.2023 14:00:00 CET | Pressemelding
Aktia Bank Abp Pressmeddelande 6.2.2023 kl. 15.00 Aktias bokslutskommuniké för år 2022 publiceras fredagen 17.2.2023 kl. 8.00 Aktias bokslutskommuniké för år 2022 publiceras fredagen 17.2.2023 kl. 8.00. Bokslutskommunikén finns tillgänglig på Aktias webbplats på adressen www.aktia.com efter publiceringen. Webcast-sändning från resultattillställningen En direkt webcast-sändning arrangeras från Aktias resultattillställning fredagen 17.2.2023 kl. 10.30. Verkställande direktör Mikko Ayub och ekonomi- och finansdirektör Outi Henriksson presenterar resultatet. Tillställningen hålls på engelska och kan ses som en direkt webcast-sändning eller en inspelning efter tillställningen på adressen https://aktia.videosync.fi/2022-q4-results. Presentationsmaterialet på engelska finns tillgängligt på Aktias webbplats www.aktia.com före resultattillställningen. Aktia Bank Abp Mera information: Lotta Borgström, direktör för investerarrelationer och kommunikation, tfn 010 247 6838, email@example.com
Bombardier CEO Éric Martel Evolves Leadership Team Structure as Part of Forward-Looking Growth Strategy, Building on Company Momentum6.2.2023 13:58:00 CET | Press release
Jean-Christophe Gallagher appointed Executive Vice President, Aircraft Sales and Bombardier Defense Paul Sislian appointed Executive Vice President of Bombardier Aftermarket Services & StrategyDavid Murray appointed Executive Vice President, Manufacturing, IT and Bombardier Operational Excellence SystemEric Filion joins Bombardier to the newly created role of Executive Vice President, Programs and Supply ChainMichel Ouellette will lead Engineering and Product Development until planned retirement later in 2023, following a 33-year, successful career MONTREAL, Feb. 06, 2023 (GLOBE NEWSWIRE) -- Bombardier today announced a leadership team evolution that will focus on carrying forward the company’s positive momentum toward executing long-term growth and optimization strategies in the key areas of defense, services, continuous product improvement and next-generation manufacturing practices. “Bombardier has successfully embarked on its journey as a company focused on its world-class business
Vision Energy Concludes Jetty Simulation Study6.2.2023 13:30:00 CET | Press release
JERSEY CITY, N.J., Feb. 06, 2023 (GLOBE NEWSWIRE) -- Vision Energy Corporation (OTCPINK:VENG) (“Vision Energy” or the “Company”) is pleased to announce it has concluded a detailed marine simulation study for the proposed design and future operations of jetty and quay wall infrastructure that will serve its Green Energy Hub in North Sea Port of Vlissingen, the Netherlands. The Company’s wholly owned subsidiary, Evolution Terminals BV, engaged Maritime Research Institute Netherlands (“MARIN”) to carry out the study, in cooperation with North Sea Port authority. MARIN is an internationally operating and recognised leading independent institution for maritime research with over 400 specialists, with headquarters in Wageningen, the Netherlands. MARIN strives for clean, smart and safe shipping and sustainable use of the sea and is an independent knowledge partner for the maritime sector, government and society. The purpose of the study was to determine whether arrival and departure maneuvers