Final answer:
More and more states are taxing services to increase revenue. While property taxes are common at the local level, the expansion of taxable services is a way for states to generate additional sales tax revenue without increasing the rate on existing goods.
Step-by-step explanation:
Although generally exempt from sales tax, more and more states are taxing services in order to increase revenue. While traditional sales taxes have typically been applied to tangible goods, there is a growing trend among states to expand their tax base by applying sales tax to services as well. This shift is intended to boost state revenues to match spending needs without increasing the tax rate on existing taxable items. For example, certain professional services, personal services, or digital services are increasingly being subject to sales tax.
It's important to note that property taxes are usually imposed by local governments and are based on the value of real estate or other significant assets. Though property taxes contribute to local revenues, they do not typically experience the same expansion as sales taxes. Instead, there have been initiatives like California's Proposition 13 to limit the growth of property taxes.