Each month cities and other local entities throughout the state receive allocations from the sales tax revenue collected in their areas. After the collections have been reported to the state comptroller’s office and the state’s portion is removed, local governments receive their allocations back, which can then be put toward a variety of funds.
The state’s sales tax rate is 6.25 percent. On top of that, local entities are able to add an additional percentage to collect up to
2 percent, leading to the 8.25 percent tax that many people see on their receipts. Local entities, including Leander and Cedar Park, collect 2 percent.
“In addition to collecting the taxes, the comptroller also issues the permits and licenses associated with sales tax-related activities as well as [performs]sales tax reporting and sales tax auditing,” said Kent Meredith, director of finance with the city of Cedar Park. “The comptroller’s office has field offices throughout the state and [is]equipped to collect overdue taxes as well. The state is much better equipped and staffed to perform these services than each individual city or town.”
As population continues to increase in Cedar Park and Leander, sales tax allocations have also increased over the past 10 years. Unlike property tax, sales tax comes from a variety of sectors.