Sales Taxation of Business Inputs: Existing Tax Distortions and the Consequences of Extending the Sales Tax to Business Services

27 Pages Posted: 11 Feb 2005 Last revised: 20 Dec 2016

See all articles by Robert J. Cline

Robert J. Cline

Ernst & Young LLP

John L. Mikesell

Indiana University Bloomington - School of Public & Environmental Affairs (SPEA)

Thomas S. Neubig

Tax Sage Network

Andrew Phillips

Ernst & Young - Quantitative Economics and Statistics Group

Date Written: February 14, 2005

Abstract

The authors examine the effect of sales taxes on business services and say that states should not extend sales taxes to those services. States should not tax business inputs, the authors say; businesses are already paying more than $100 billion in sales taxes on services, they calculate.

Keywords: sales tax, business tax, tax on services

JEL Classification: G30, G38, H00, H20, H25, H32

Suggested Citation

Cline, Robert J. and Mikesell, John L. and Neubig, Thomas S. and Phillips, Andrew, Sales Taxation of Business Inputs: Existing Tax Distortions and the Consequences of Extending the Sales Tax to Business Services (February 14, 2005). State Tax Notes, Vol. 35, No. 7, February 14, 2005. Available at SSRN: https://ssrn.com/abstract=665702

Robert J. Cline (Contact Author)

Ernst & Young LLP ( email )

1225 Connecticut Ave NW # 700
Washington, DC 20036
United States
202-327-6000 (Phone)

John L. Mikesell

Indiana University Bloomington - School of Public & Environmental Affairs (SPEA) ( email )

1315 East Tenth Street
Bloomington, IN 47405
United States
812-855-0732 (Phone)
812-877-7802 (Fax)

Thomas S. Neubig

Tax Sage Network ( email )

4807 Autumn Lake Way
Annandale, VA
United States

HOME PAGE: http://www.taxsagenetwork.com

Andrew Phillips

Ernst & Young - Quantitative Economics and Statistics Group

1225 Connecticut Avenue NW
Washington, DC 20036
United States

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