TheTax and Regulatory Compliancetopic in the APS Certification Program covers sales and use taxes, which are imposed on the sale or use of goods and services. In the U.S., sales and use taxes are levied bystatesand, in many cases,cities and towns(local jurisdictions). Thefederal governmentdoes not impose sales or use taxes, as this authority is reserved for state and local governments.
Item I (Cities and towns): Many cities and towns impose local sales taxes, often in addition to state taxes, to fund municipal services. This is a valid taxing authority.
Item II (Federal government): The federal government does not levy sales or use taxes; it imposes taxes like income or excise taxes. This is not a valid taxing authority for sales and use taxes.
Item III (States): States are the primary authorities for sales and use taxes, setting rates and rules for taxable transactions. This is a valid taxing authority.
Option A (II and III only): Incorrect, as Item II is not a valid taxing authority.
Option B (III only): Incorrect, as Item I is also a valid taxing authority.
Option C (I and III only): Correct, as only states and local jurisdictions (cities and towns) levy sales and use taxes.
Option D (I, II, and III): Incorrect, as Item II is not a valid taxing authority.
Reference to IOFM APS Documents: The APS e-textbook underTax and Regulatory Compliancestates, “Sales and use taxes are levied by states and local jurisdictions, such as cities and towns, but not by the federal government.” The training video discusses AP’s role in managing sales tax compliance, noting that “states and local governments set sales tax rates, while the federal government does not impose such taxes.”
