USA has a number of taxes. Besides the broad classification at the government level, if we look at the types , we come across the following types of taxes:
- Payroll Tax
- Property Tax
- Sales Tax
- Tariff & Custom Duty
- Estate & Gift Tax
- Payroll Tax is imposed by the federal and all state governments. It includes Social Security and Medicare taxes imposed on both employers and employees.
- Employers are required to withhold income taxes on wages. An unemployment tax and certain other levies apply to employers.
- Property tax is imposed by most local governments and many special purpose authorities based on the fair market value of property.
- School and other authorities are often separately governed, and impose separate taxes.
- Property tax is generally imposed only on realty, though some jurisdictions tax some forms of business property.
- Sales tax is imposed by most states and some localities on the price at retail sale of many goods and some services.
- Sales tax rates vary widely among jurisdictions, from 0% to 16%, and may vary within a jurisdiction based on the particular goods or services taxed.
- Sales tax is collected by the seller at the time of sale, or remitted as use tax by buyers of taxable items who did not pay sales tax.
Tariff & Custom Duty
- Tariff or custom duties are applicable on the import of goods from various jurisdictions
- These tariffs or duties must be paid before the goods can be legally imported
- Rates of duty vary from 0% to more than 20%, based on the particular goods and country of origin
Estate & Gift Tax
- Estate and gift tax is imposed by the federal and some state governments on the transfer of property inheritance, by will, or by lifetime donation
- Similar to federal income taxes, federal estate and gift taxes are imposed on worldwide property of citizens and residents and allow a credit for foreign taxes