Arizona voters’ approval yesterday of a temporary 1 percent increase in the state’s sales tax underlines the points I made in a recent post: Sales and use taxes are creeping higher around the country, and they now rival state and local income taxes as a rising compliance challenge for business. The Arizona decision may encourage other states to attempt to patch up the holes in their budgets with rate hikes.

It’s the constant changes in rates and rules that make sales and use taxes such a challenge for businesses to track and manage, and which also explain the vibrant health of the best-of-breed technology sector that helps companies cope. more

The IRS is pulling out all the stops to get the word out about the new healthcare tax credit for small businesses provided by the Affordable Care Act, and has released new guidance covering a range of questions that Congress didn’t address. If your organization has 25 employees or fewer, offers health benefits, and covers more than 50 percent of the insurance cost, you might want to check out the IRS’s Affordable Care Act page, which includes links to detailed guidance, a simplified 3-step guide, and frequently asked questions. more

I usually think of the federal income tax as the biggest tax compliance headache for companies, but a new report from Grant Thornton is a stark reminder that state and local taxes are becoming more and more challenging. Forty percent of the CFOs polled by the audit firm say that state and local tax compliance is more demanding than federal income tax compliance. In Michigan, which has just implemented a new business tax system, that figure rises to 64 percent.

Grant Thornton didn’t look specifically at sales and use tax issues, but it’s clear that this area is fast becoming just as demanding as state and local income tax, or more so. more

If you’re in tax and you get wind of any big IT initiatives going on in your company, better jump in there fast. There’s a wave of re-implementations of ERP and business performance management (BPM) systems going on, and tax departments don’t want to miss out this time the way too many of them did on earlier initiatives. more