Question

Which type of tax do state governments collect?

A. Payroll
B. Social Security
C. Customs
D. Sales

I know B and C are wrong because SSA (Social Security Administration) is a federal program, and customs would also be federal because Border Patrol agents are federal agents protecting the US. So that leaves A and D, and not sure which is right. I’m leaning toward D. Sales because sales taxes vary by each state, but do payroll taxes vary?

Answer 1

The type of tax that state governments collect includes:

• Payroll (income tax)
• Sales tax

What is state governments revenue sources?

In most states, their main revenue sources includes from the sales taxes, property taxes and revenue from federal government.

Hence, the Income (Payroll) and Sales tax are the type of tax that state governments collect.

Therefore, the Option A, D is correct.

Read more about state revenue

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