Arizona has highest single jurisdiction sales tax

UPDATE. September 27, 2011. We would like to clarify that the “highest rate” includes the Sovereign Nation rate which does not apply to all residents or consumers. The Tax Foundation report was also using a weighted average for their numbers.

In a recent news release the Tax Foundation identified Tuba City, Arizona as having “the highest single jurisdiction in the U.S. for sales taxes…[with a] combined rate of 13.725%.” Broken down, the tax consists of “…a 6.6% state tax, a 1.125% Coconino county tax, and an additional 6% tax levied by the local Navajo [To'Nanees'Dizi] tribal government.”

Based on a population-weighted average, the Fiscal Facts report from Tax Foundation provides visibility to the county, city and local taxes that add weight to sales tax. Four of the five states that do not charge sales tax do not allow localities to charge a local sales tax, however, Alaska does. More highly populated areas like Juneau and Kodiak charge 5 and 6 percent, respectively, but this still does not bring Alaska into the highest range for combined sales tax rates. When using weighted averages based on population, the average local tax rate in Alaska is actually 1.74%.

More Statistics class, great.

An interesting point in sales tax is that states, counties, cities, local jurisdictions, special districts can all levy sales taxes, but in addition to the basic jurisdictions, states can levy mandatory, statewide local add-on sales taxes. In other words, some states, such as California can tell the local jurisdictions to add a local sales tax. California requires 1%, Utah – 1.25% and Virginia – 1%.

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