1. Taxes  Included in this presentation: why do we have some taxes such as cigarette, alcohol, gasoline? why are taxes higher in some regions?

2. State Sales Tax All states except Alaska, Delaware, Montana, New Hampshire and Oregon, collect sales taxes. States with the highest sales tax are: California (7.25%), Mississippi (7.0%), New Jersey (7.0%), Tennessee (7.0%), Rhode Island (7.0%), Minnesota (6.5%), Nevada (6.5%), and Washington (6.5%). Many cities and counties have the option of imposing an additional local option sales tax. For instance, in Tennessee some cities add as much as 2.75%. Nevada's sales tax varies by county and can be as high as 7.75%. Most states exempt prescription drugs from sales taxes. Some also exempt food and clothing purchases and a few also exempt non-prescription drugs.

3. Internet Sales…is there sales tax?  EXAMPLE  Margo is passionate about rare orchids but can't find them in Indiana, so she orders her supplies online from an orchid supplier with headquarters in Vermont. The supplier has all of its facilities in Vermont and collects payment in Vermont. Margo does not have to pay Indiana sales tax (or Vermont sales tax) on her orchids. A few months later, the supplier opens a warehouse in Indiana to handle its online orders for the entire country. Margo continues to order her orchids from the headquarters in Vermont but she must now pay Indiana sales tax. Her ride on the tax- free train is over.

4. Cigarette Tax Several states are continuing to raise excise taxes on cigarettes and other tobacco products in order to increase revenue. The rates shown do not include the federal cigarette tax of 39 cents a pack. Chicago is the most expensive place to buy cigarettes. The top five states with the highest state tax on cigarettes are: New Jersey ($2.58), Rhode Island ($2.46), Washington ($2.025), tied for fourth place are Arizona, Maine, Michigan ($2.00), and fifth is Alaska ($1.80). Counties and cities may impose an additional tax ranging from 1 cent to $2.00 on a pack of cigarettes. About 82% of what consumers pay for a pack of cigarettes (average cost $4.26 - including statewide sales taxes but not local cigarette or sales taxes) ends up going to the government in taxes and other payments rather than for the cigarettes.

5. Personal Income Tax A total of 41 states impose income taxes. New Hampshire and Tennessee apply it only to income from interest and dividends. Seven states (Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming) do not tax personal income. Of the 41 with a broad-based income tax, 35 base the taxes on federal returns, typically taking a portion of what you pay the IRS or using your federal adjusted gross income or taxable income as the starting point.

6. ILLINOIS Sales Taxes State Sales Tax: 6.25% (1% on qualifying food, prescription & non- prescription drugs, medical appliances). Local government taxes can raise the total to a high of 8.5%. Gasoline Tax: * 40.6 cents/gallon Diesel Fuel Tax: 41.3 cents/gallon Cigarette Tax: 98 cents/pack of 20 (In Chicago, the state and local rate is $3.66; Evanston is $3.30), Cicero is $3.14, Rosemont is $3.03, cities with no tax in Cook County - $2.98)

7. IOWA Sales Taxes State Sales Tax: 5% (food and prescription drugs exempt); local option taxes can add up to another 2%. Gasoline Tax:: 21.7 cents/gallon Diesel Fuel Tax: 23.5 cents/gallon Gasohol Tax: 21.7 cents/gallon Cigarette Tax: $1.36/pack of 20; $1.70/pack of 25

8. MINNESOTA Sales Taxes State Sales Tax: 6.5% (food, clothing, prescription and non-prescription drugs exempt); Liquor and beer taxed at 9.15%. A few cities and counties also add a sales tax which can be as high as 1.0%. Gasoline Tax: 20 cents/gallon Diesel Fuel Tax: 20 cents/gallon Cigarette Tax: $1.49/pack of 20

9. Minnesota  Minnesota has a 6.5% state sales tax. Minnesota  Food (not including prepared food, some beverages such as soda, and other items such as candy) and Clothing are exempt from this tax.  Municipalities may be allowed by the State Legislature to institute local option taxes. Current local option taxes include a "Lodging" tax in Duluth(3%), Minneapolis(3%), and Rochester(4%), as well as served "Food and Beverage" tax in Duluth(2.25%). An additional 0.5% is imposed in St. Paul, bringing the total sales tax to 7%. An additional 0.15% is imposed Hennepin County to finance a new Minnesota Twins stadium, in addition to 0.5% imposed in Minneapolis, bringing the total rate in the city of Minneapolis to 7.15% and 6.65% in the rest of Hennepin County;Hennepin CountyMinnesota Twins

10. NEW YORK Sales Taxes State Sales Tax: 4.0% (food, prescription and non-prescription drugs exempt); Other taxing entities may add up to 5.5% in additional sales tax. Gasoline Tax: 40.9 cents/gallon Diesel Fuel Tax: 38.9 cents/gallon Cigarette Tax: $1.50/pack of 20; New York City adds an additional $1.50.

11. WISCONSIN Sales Taxes State Sales Tax: 5% (food and prescription drugs exempt); County tax is 0.5%. Gasoline Tax: 32.9 cents/gallon Diesel Fuel Tax: 32.9 cents/gallon Cigarette Tax: $1.77 cents/pack of 20

12. CALIFORNIA Sales Taxes State Sales Tax: 6.25% (food and prescription drugs exempt. Tax varies according to locality. Can be as high as 8.50%) Gasoline Tax: * 44.4 cents/gallon Diesel Fuel Tax: * 45.0 cents/gallon Cigarette Tax: 37 cents/pack of 20 plus an additional surcharge of 50 cents per pack, bringing the total to 87 cents.