The City of Kake has completed the process to join the Alaska Remote Sellers Sales Tax Commission (ARSSTC). Sellers must begin collection on 9/1/2025 and forms for filing will be updated to include Kake on 10/1/2025.
Sales tax regulations are shifting fast—with key changes already impacting businesses in 2025. In this webinar, Sovos legal experts will break down the latest updates, including sales tax holidays, grocery and bullion changes, and practical compliance strategies to keep you ahead.
Effective July 10, 2025, Alaska HB 123 became law without the Governor’s signature. The legislation provides for a reduction in the Vehicle Rental Tax rate from 10% to 9% of the total fees and costs charged for the lease or rental of a passenger vehicle not arranged through a vehicle rental platform under AK Statutes 43.52.020.
The Federal Board of Revenue (FBR) of Pakistan has announced, once again, an extension to the mandatory e-invoicing integration deadlines. According to the official notification issued on 20 June 2025, the integration deadlines have been pushed back by one month.
Under the revised schedule:
Corporate registered persons now have until 1 July 2025 to complete their integration
Non-corporate registered persons have been granted until 1 August 2025
This represents the second extension to the original deadlines established under S.R.O. 709(I)/2025, which initially set 1 May 2025 for corporate entities and 1 June 2025 for non-corporate entities.
While the deadlines have been extended, businesses must still:
Integrate their electronic invoicing systems with the FBR’s computerized system
Connect through either a licensed integrator or Pakistan Revenue Automation Limited (PRAL)
Ensure compliance with Rule 150Q of the Sales Tax Rules, 2006
Transmit invoice data securely and in real-time to the FBR
With the new deadlines approaching, businesses should promptly evaluate their integration readiness and engage with a licensed integrator or PRAL as soon as possible.
For future updates on Pakistan e-invoicing requirements and similar developments in other countries, subscribe to our Regulatory Analysis page.
New Mexico lawmakers recently passed HB 218, which changed the dates of the annual back to school tax holiday to the last weekend of July. This year, the holiday takes place from July 25, 2025 to July 27, 2025. Certain retail items will be eligible for a tax exemption during this time subject to certain thresholds. Further information may be found here.
Effective January 1, 2026, Illinois will exempt food for human consumption through a repeal its 1% sales tax. This exemption will not apply to alcoholic beverages, cannabis-infused products, soft drinks, candy, or prepared foods meant for immediate consumption. Coinciding with the repeal, municipalities will have the option to impose their own 1% grocery tax, replacing the state tax if they choose to adopt it.
For more information, see Public Act 103-0781.
Beginning January 1, 2026, Illinois will eliminate the 200-transaction threshold for establishing economic nexus for sales tax purposes. Going forward, both remote retailers and marketplace facilitators will be subject to economic nexus rules based solely on whether their cumulative gross receipts from sales to Illinois purchasers exceed $100,000 over the previous 12 months. Remote retailers must assess their sales on a quarterly basis to determine if they meet or exceed this threshold.
Also taking effect on January 1, 2026, Illinois will expand its “Leveling the Playing Field” provisions to include the Service Occupation Tax (SOT) and the Service Use Tax (SUT), requiring collection of both state and local taxes for services provided from outside Illinois to an Illinois customer. Previously, only the state’s 6.25% tax was collected on such transactions.
To find out more information, please see Public Act 104-0006, which was enacted on June 16, 2025.
Massachusetts lawmakers recently set the date for the annual sales tax holiday. The 2025 holiday will take place August 9th and 10th. During the holiday, the state’s 6.25% sales tax is suspended for most retail items priced under $2,500. For more information on the announcement of the annual sales tax holiday in Massachusetts click here.
The Colorado Department of Revenue recently released the July 2025 local sales tax changes. Among the changes were new state-administered districts to supplement funding for related fire and ambulance services in the districts through the levy of sales tax.
The following Fire Protection Districts were added:
Berthoud FPD
Cortez FPD
Eagle River FPD
Frederick-Firestone FPD
The following Ambulance district was added:
Dove Creek AD
More information regarding the local changes may be found here.
In Connecticut, a surcharge is assessed by the Public Utilities Regulatory Authority on all phone lines, including prepaid wireless services, in order to fund E911 services. Each fiscal year the amount of the surcharge is reviewed. Pursuant to Public Utilities Regulatory Authority Docket No. 25-01-05, the surcharge has been decreased for prepaid wireless services from $0.73 to $0.69, effective July 1, 2025.
In Minnesota, the Prepaid Wireless E911, TAM and 988 fees are increasing from a combined fee amount of $0.95 to $0.96 effective July 1, 2025. The fee is comprised of 3 parts as follows:
E911 Fee – $0.80
TAM Fee – $0.04
988 Fee – $0.12
Earlier this year Mississippi passed HB1 which reduces the state sales and use tax rate on groceries for human consumption from 7% to 5% starting on July 1, 2025.
Per the bill, the term “groceries” refers to food or drink for human consumption that is eligible to be purchased with food stamps. Items purchased with food stamps will continue to remain exempt from sales tax. Items that are not eligible to be purchased with food stamps will remain taxable at 7%
HB 1 can be viewed in its entirety here.
On May 20, 2025, Maryland House Bill 352 was signed into law, enacting a 3% tax on certain data and information technology services and repealing the exemption for specific custom computer software. These changes are effective July 1, 2025. Further information may be found here.
Washington’s governor recently signed three pieces of legislation which will have a major impact on retail sales tax in the state.
Senate Bill 5794 would repeal the exemption from sales tax (as well as business and occupation taxes) of sales of precious metal bullion and monetized bullion effective January 1, 2026.
Senate Bill 5801 makes several changes to taxes on sales and rentals of motor vehicles. The bill will increase the sales tax on passenger car rentals to 11.9% in 2026 and then decrease it to 9.9% in 2027. The additional sales tax on motor vehicle sales will increase to 0.5% in 2026. The replacement vehicle tire fee will increase to $5 per tire in 2026. Finally, the bill also imposes new additional taxes on peer-to-peer car sharing services and sales of “recreation vessels” subject to the watercraft excise tax, motor vehicles valued over $100,000, and luxury aircrafts.
Senate Bill 5814, an earlier version of which was discussed here, will expand the number of services subject to sales tax. Included in this expansion are sales of custom software, software customization services, information technology training services, technical support. data entry services, data processing services, custom website development services, investigation services, security services, temporary staffing services, select advertising services, live presentations, and digital automated services involving the application of human effort by the seller. The bill also creates exemption for telehealth and telemedicine. Please note provisions related to the prepayment of sales taxes and increasing the cigarette tax were dropped from the final version of the bill.
In Maryland, the purchase price of precious metal bullion or coins were exempt from sales tax if the taxable amount exceeded $1,000. On May 20, 2025, House Bill 352 was signed into law. The legislation provides, effective July 1, 2025, that for the exemption to apply, precious metals bullion or coins must also be purchased at the Baltimore Convention Center.
The Ohio Department of Taxation recently announced the 2025 dates for Ohio’s All-Inclusive Sales Tax Holiday. The holiday period for the 2025 season will occur August 1-14, 2025.
Further information concerning the holiday may be found here.
In a country where sales tax is the norm, a handful of states stand out for going against the grain—they don’t impose any statewide sales tax at all. That’s right—no last-minute filings, no scrambling to collect and remit every month. At least, not for sales tax. But before you pack your headquarters and head for the border, there’s more to the story.
So which states said “no thanks” to taxing retail sales? And what does that really mean for your businesses, especially in a world where economic nexus laws still apply and local jurisdictions may have rules of their own? Explore the five U.S. states with no sales tax and what smart businesses should consider before calling them tax havens.
As of 2025, Alaska, Delaware, Montana, New Hampshire, and Oregon do not collect state-level sales tax. These five states have opted out of traditional sales tax structures, though some—like Alaska—may still allow local jurisdictions to impose their own sales taxes.
Alaska doesn’t impose a statewide sales tax, but that doesn’t mean businesses are entirely off the hook. Many boroughs and municipalities charge their own local sales taxes, with rates climbing as high as 7.5%. These rates vary significantly by location, meaning compliance isn’t as straightforward as it may seem.
For businesses selling in or shipping to Alaska, this patchwork system requires careful attention. What’s tax-free in Anchorage may be fully taxable in Kodiak, so using a local sales tax lookup tool is essential to stay compliant and avoid costly mistakes.
Delaware is one of the only states with zero sales tax—state or local. It’s also a corporate favorite, known for its pro-business laws and minimal red tape. For online sellers, holding companies, and incorporation seekers, Delaware is a magnet.
However, while there’s no traditional sales tax, Delaware does impose a Gross Receipts Tax on the total receipts of a business. Unlike sales tax, this is paid by the business and cannot be passed directly to consumers, potentially impacting margins.
Oregon is a true no-sales-tax state meaning no local, and no hidden retail sales taxes. This makes it especially appealing for businesses with high transaction volumes, as the total price to consumers can be lower without the added burden of sales tax at checkout.
But while businesses benefit from simplified sales tax compliance, the state recoups revenue through higher income and excise taxes, which can affect overall operating costs. For business leaders, it’s important to weigh the savings on sales tax against potential increases in other tax obligations when building long-term cost projections.
Montana has no statewide or local sales tax, making it one of the most tax-friendly states in the country when it comes to retail transactions. The only exceptions are a handful of resort areas that impose a local “resort tax” on specific goods and services like lodging, food, and alcohol.
For most B2B transactions, Montana offers a low-friction environment—particularly appealing for eCommerce sellers and manufacturers looking to establish a footprint with minimal compliance complexity. For businesses, this translates to fewer tax collection obligations and simpler checkout processes, though it’s still essential to stay informed about local tax nuances in tourism-heavy regions.
New Hampshire is known for its pro-business tax climate and does not levy any state or local sales tax. This makes it an attractive option for companies selling goods both in-state and across state lines, as it eliminates the burden of tracking and collecting sales tax on retail transactions.
However, the state does generate revenue through other channels, including Business Profits Tax (BPT) and Business Enterprise Tax (BET). For larger businesses with significant revenue or payroll, these taxes can add up. While the lack of sales tax reduces front-end compliance, companies still need to factor in these corporate-level taxes when evaluating long-term operating costs in New Hampshire.
Just because certain states do not tax sales does not mean they’re “tax-free.” They’ve instead crafted tax structures that rely on other mechanisms to fund public services, infrastructure, and education without taxing retail sales of goods and services. The five states that do not charge a statewide sales tax often capitalize on alternative revenue streams, including:
The trade-off between sales tax and income tax affects everything from gross sales strategy to corporate tax planning. Businesses need to evaluate the full picture—not just whether they’ll need to collect and remit sales tax, but how other tax structures could impact their margins, growth plans, and long-term profitability.
To learn more about state specific rates and sales tax by visiting our blog.
In today’s rapidly evolving regulatory landscape, tax departments are under increasing pressure to enhance efficiency, ensure compliance and deliver strategic value. However, securing an investment in tax technology often requires a compelling business case that resonates with organizational stakeholders. With the right strategy and organization buy-in, you can transform your tax.
Join us for this webinar where Sovos experts will be joined by an SAPinsider analyst to discuss how tax leaders can construct a persuasive business case for tax technology investment. Drawing from real-world experiences and best practices, we’ll explore how to align tax technology initiatives with broader organizational goals, quantify both tangible and intangible benefits and effectively communicate the value proposition to decision-makers.
Attend to learn how you can:
Quantify ROI, including cost savings, risk mitigation and process improvements.
Simplify support frameworks by centralizing your tax technology under one.
Transform your tax center into a profit center.
Anticipate future requirements and ensure flexibility in tax processes.
Strengthen your business case and engage stakeholders effectively.
Whether you’re a tax professional seeking to modernize your department or a finance leader evaluating technology investments, this webinar will equip you with the tools and insights needed to build a robust business case for tax technology.
Don’t miss this opportunity to learn how you can transform your tax function into an asset for the business.