TACOMA, Wash. — Tacoma imposes the highest combined state and local sales tax rate among major cities in the United States, according to a report the nonprofit The Tax Foundation released this month.
Tacoma has had a sales tax rate of 10.3 percent since July 1, when its one tenth of 1 percent sales tax increase to fund affordable housing projects went into effect.
The action increased Tacoma’s sales tax from 10.2 percent to 10.3 percent, adding a dime to every $100 purchase, not including groceries. Broken down, Tacoma imposes a state sales tax of 6.5 percent and a local sales tax of 3.8 percent.
Among major cities, or cities with more than 200,000 people, Tacoma ranks No. 1 in the highest sales tax rate. There’s a five-way tie between Chicago; Fremont, Calif., Long Beach, Calif., Oakland, Calif.; and Seattle, which all have a combined state and local sales tax rate of 10.25 percent. Birmingham, Ala., also has a sales tax rate in double digits at 10 percent.
The major cities with the lowest combined sales tax listed in the report are Portland, Ore. and Anchorage, Alaska, both of which do not impose any state or local sales taxes. Honolulu, Hawaii has a sales tax rate of 4.5 percent.
Sales tax is part of the larger tax structure and should be taken in context, noted the report. For example, while Washington state may have high sales taxes, it does not impose income tax, whereas Oregon imposes high income taxes, but no sales tax.
The report used information from the Sales Tax Clearinghouse, city ordinances, state revenues and auditing departments.
This story was originally published by The News Tribune.
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