Why Outsourcing is Considered A Rapidly Evolving Environment

• Sales and property tax collections in the US exceed $226 Billion per year, representing on average 32% of total state government revenues. They typically increase by 4% or more per year - sales taxes are clearly a critical source of revenue.
• With over 7,500 individual state & local tax jurisdictions, the pace of change has become extremely rapid: the number of rate changes per year averaged 643 for the 1998-2002 period, but this average has increased to 788 per year for the 2003 -2007 period, an increase of more than 22%.
• State tax authorities are increasingly aggressive in auditing taxpayers; states have hired and trained more and more auditors, engaged in multi-state compacts, and developed information sharing arrangements amongst themselves and also with the Federal government.
• SOX and FAS 5 effectively dictate that corporate sales tax functions must be high quality, controlled processes.
• State and local jurisdictions are experiencing unprecedented structural budget deficits and they are responding by imposing taxes that are not susceptible to fluctuations in net income.