Question

Which of these BEST describes how local governments collect sales tax?

Answer 1

Answer:

A local government can charge a sales tax in addition to the state sales tax.

Explanation:

State governments are responsible for collecting taxes on sales within their states. This is also attributed to local government as they also collect sales tax by charging tax on sales within the local government in addition to the state sales tax.

When local government charge sales tax , it increasees their revenue base in addition to other taxes collected by them like property tax and charges/fees including transfer from federal and state government.