Which tax is levied on tangible personal property sold at retail?

The correct answer is retail sales tax, which is specifically designed to be applied to the sale of tangible personal property at the point of retail sale. When consumers purchase goods, this tax is collected by the seller and then remitted to the government. The rationale behind this tax is straightforward: it's a way for states to generate revenue based on consumer spending.

Retail sales tax is typically added to the purchase price of goods, which means that the total amount paid by the consumer will include both the cost of the item and the sales tax. This form of taxation is prevalent in many jurisdictions and often excludes certain items, such as groceries or prescription medications, which may be considered necessities.

Comparatively, income tax applies to the earnings of individuals or entities, property tax is assessed on real estate or land holdings rather than personal property, and excise tax is levied on specific goods like alcohol, tobacco, or fuel rather than on general retail transactions. Therefore, the nature and application of the retail sales tax directly align with the question, confirming it as the correct choice.