July 1 not only marks the middle of the year. It's the start of a new fiscal year for most state governments and that means new laws typically take effect.
Here are some of the new tax statutes now on state books.
Indiana has changed how it calculates tax on gasoline. Instead of the previous fixed 19-cent-per-gallon sales tax, the tax rate will be modified month-to-month. Specifically, the Hoosier State's gas usage tax rate now will be 7 percent of the average price of gas the previous month.
That means, says the Indiana Department of Revenue, that the state's July gas tax will be a tad higher. It's now $0.229 per gallon, calculated off of an average per gallon price of $3.269. Given that gas prices tend to stay up during the summer driving season, Indiana drivers shouldn't expect lower tax rates for a few months.
New Hampshire drivers also will be paying more, 4.2 cents extra per gallon of gas, to cover highway improvements.
The news is better for some drivers in Virginia. As of today, the Old Dominion no longer collects a $64 annual license tax on hybrid vehicles.
Idaho lawmakers renewed a film tax rebate created in 2008 that had never been used in the state due to a lack of funding. To take advantage of the credit, film producers must promise to spend at least $200,000 on production in the Gem State and 35 percent of the production crew must be Idahoans.
Several veterans' tax incentives took effect today in the Hawkeye State to encourage military veterans to return or move to Iowa. Among the components of the Home Base Iowa initiative is an exemption for military pensions, including benefits paid to surviving spouses, from state income tax.
States focus on business tax breaks: Stateline, a news service of the Pew Charitable Trusts, reports that today, for the first time in years, governors and legislators are cutting some taxes, taking advantage of an improved revenue outlook. Most of the cuts are for businesses, the thinking being that the incentives will encourage job growth in their jurisdictions.
Corporate tax rates in Indiana and Rhode Island drop today, according to Stateline. Rhode Island's corporate tax rate will drop from 9 percent to 7 percent. Indiana businesses will see their rates nudge down from 7.5 percent to 7 percent.
In Idaho, software purchased via cloud will be sales-tax-free. And to lure businesses, Maryland is beefing up cybersecurity, biotechnology and research and development tax credits.
Stateline reports that on the individual tax side, nonprescription drugs in Connecticut are now free from sales taxes.
Florida purchasers of youth bicycle helmets, child restraint systems and booster seats won't have to pay the state sales tax on those items.
Long list of tax exemptions: Other states also are offering a variety of tax exemptions, business an individual, effective today, according to TaxRates.com. They include:
- Arkansas — Sales of utilities used for commercial grain drying and storage, first $50,000 of the purchase price of certain timber harvesting equipment, and dental appliances sold to or by certain dental professionals
- California — Partial exemption for manufacturing, research and development equipment as long as manufacturers get written proof of qualification for the exemption
- Connecticut — Numerous admissions charges and certain sales by and to community hospitals and credit unions
- Florida — Prepaid meal plans purchased by students enrolled at institutions of higher learning, and certain therapeutic veterinary diets obtained from licensed veterinarians.
- Indiana — Blood glucose monitoring meters.
- Maine — Certain sales of adaptive equipment that enables people with disabilities to drive
- Maryland — Admissions and amusement tax exemption is expanded to many artists
- Mississippi — Aircraft used predominantly to transport passengers/property to offshore oil or natural gas rigs
- New York — Sales of certain medical equipment and services
- North Carolina — Sales of prepaid meal plans
- Oklahoma — Tangible personal property sold by or to nonprofit parent-teacher associations or organizations
- South Carolina — Admissions to the South Carolina State Museum
- Wisconsin — Certain sales and storage or use of parts used to repair aircraft, and charges for the repair or servicing of certain aircraft
Avalara's TaxRates blog has even more exemptions, as well as a list of states with July 1 sales tax rate changes and other laws that impact sales taxes starting today.
Finally, Major League Soccer, which is hoping to beef up its domestic fan base thanks to the U.S. team's showing in World Cup competition, gets a tax break from Florida.
The Sunshine State has expanded to MLS all-star games an admissions-tax exemption that already applies to events such as all-star games hosted by Major League Baseball, the National Basketball Association, the National Hockey League and the National Football League.
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