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State Sales Taxes
States collect a great portion of their revenue from state sales taxes on the sale of goods and services. Typically, states impose three types of sales tax: the vendor tax, the consumer tax and the combination vendor-consumer tax.
All persons, regardless of their income, pay the same rate of sales tax on their purchases. For this reason, some items of necessity are not taxed, such as food or prescription medicine, making those items more affordable for lower income individuals and families. Additionally, certain charitable and religious organizations are exempt from paying sales tax on their purchases.
SIDEBAR: Use taxes are imposed on certain transactions that are not subject to sales tax. One of the most common use taxes that states impose on residents is the use tax on vehicles leases and rentals.