STOCK MARKET WATCH -- Wednesday, 7 March 2012

[Demeter]

9. Average sales tax rate lowest in 45 years

http://abcnews.go.com/Business/average-sales-tax-rate-lowest-45-years/story?id=15804632#.T1QVcnlm7Tg

The average sales tax rate that Americans pay dropped last year to the lowest level since 1967 as a shift to tax-free Internet sales and untaxed services keeps eroding the No. 1 source of revenue for state and local governments, a USA TODAY analysis finds.

States and cities are being forced to keep their belts tight because sales tax collections rose only 1.2% last year even though consumer spending climbed 4.7%.

Governments have jacked up sales tax rates in recent years to get more money. But consumers are a step ahead, buying less of what's taxed and using the Internet to save money. The result: higher tax rates covering a shrinking share of purchases.

Americans paid an average 4.27% sales tax rate on purchases in 2011, down from 4.63% five years ago and far below the peak of 5.18% in 1973, according to an analysis of Bureau of Economic Analysis data....MORE