Most states charge sales tax for purchases made locally. This is not surprising. For FY 2012 it represented 13.9% of the States Income. (http://finances.marylandtaxes.com/Where_the_Money_Comes_From/default.shtml)
Most don’t like to pay taxes and I am one of them but I think that sales tax is important. Those who spend more pay more. If you make an on-line out of state purchase in most cases the purchaser doesn’t pay sales tax. In actuality as a Maryland resident you are suppose to report those purchases to the comptroller of the state and submit the sales tax for your purchase. Few if any do. The loss of revenue has to be replaced by the state in some form or services need to be reduced. Saving on the sales tax on your purchase doesn’t mean you are actually coming out ahead. There is a consequence of this decision. A higher tax or fee imposed by the state somewhere or more likely reduced services.
In Anne Arundel County we have already seen a reduction in the number of trash pickups. Many lament the conditions of our schools and the low salaries paid to our teachers. How about our first responders having the equipment and the training to do their jobs to the best of their ability? The states infrastructure is in need of repair, water systems are aging, roads and over passes need repair. How about the improvement of social services to help the less fortunate? I could go on and on but I think you get the point.
The exiting of the sales tax from the state and the loss of the actual sales in the state have great consequences that many don’t consider. So yes you can save 6% and a few bucks on your purchases but what is the true cost of your savings.
A Few Stats:
- For every $100 spent at local small businesses $68 returns to the community.
- Local business employ half of all private sector employees.
Think about how much your purchase can help the local economy. By keeping your money locally you can help strengthen it, possibly help increase the workforce and more. So the next time you make a purchase please give it some thought.