Service Sales Tax By State: Important Things To Know

According to Focus Economics’ recent economic forecast, the services sector is the main engine of our economy in the United States. Since service-oriented companies are such a large part of our economy, we thought it would be beneficial to look at how services are taxed in different states across the country.

Are Services Subject To Sales Tax? 

When we think of sales tax, most people assume that only the sales of tangible goods are subject to it. Most state laws are written to assume that sales of tangible personal property are subject to sales tax unless there is a specific exemption (there can be many!) and laws for sales of services are written to assume that services are exempt unless specifically enumerated. So historically, while it certainly varies by state, few services were subject to sales tax.

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