Final answer:
The claim that only five states charge sales tax on purchases is false; most states in the U.S. have varying rates of sales tax, making it a significant source of revenue for them. Therefore, the given statement is false.
Step-by-step explanation:
The statement that only five states in the United States currently charge sales tax on purchases is false. In fact, most states impose sales taxes on the retail sale price of many goods and some services. The rates of these sales taxes can vary widely among states, with a range of 0 percent to around 16 percent. These taxes are a significant source of revenue for state governments and often apply to a variety of items such as food, clothing, alcohol, and public utilities.
For state governments, sales taxes are crucial as they account for approximately 47 percent of total tax revenue, according to data referenced from the U.S. Bureau of the Census. This is a substantial portion of state revenue, which also includes income taxes, federal support, and service charges. Minnesota, for example, is unique in that it does not levy a sales tax on clothing, illustrating the variations in sales tax application across different states.