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Rajeev mathur
Founder, HiValue Consulting
August 24, 2026
Due to revenue shortfall in all the sales tax collecting states in the U.S, revenue authorities have included digital goods and services as a category to charge sales tax. By collecting sales tax on digital goods and services, states expect to meet partially or fully , their revenue shortfall.
In recent years, a growing number of states have begun expanding the definition of taxable software, digital products, technology services such as SAAS, data processing, cloud services, streaming, advertising technology and digital subscriptions.
Vermont, Louisiana, Maryland, Washington state, Maine, Utah,Colarado, and California are some states which have commenced collecting sales tax on digital goods and services .
This trend is expected to spread as more states facing revenue shortfall, shall resort to this new revenue source.
Abridged article from Sales tax institute blog pages.
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