Quote:
Originally Posted by HarryT
Yes, but if you buy from out-of-state or online, don't you have to pay "use tax", which is the same amount that you would have paid in sales tax had you bought it in your own state?
Forgive me if my knowledge of the US tax system is inaccurate.
|
no...google is free...there is a thing we have called State's Rights which the last administration as well as his daddy forgot about. But one thing that never has been infringed upon is STATE & LOCAL sales tax. We have not form of VAT or such...yet...and if you happen to buy something a a street in a down where the businesses on the other side of the street are in a different city or county, the sales tax and be different by as much as 2-3%. Yeah, it is weird.
As far as paying sales tax, in most states if a resident buys something outside of state lines it is supposed to be reported and tax paid...same goes for local taxes. But , obviously those laws were written in a different time and no longer practical. In fact I know nobody who willingly pays taxes on such purchases.
Another law we have has to do with reciprocation of certain laws between states, and this is where what is being misnamed an "internet sales tax" might spring. If someone lives in a state with a different (read lower as who would ask to pay MORE taxes), but if they live somewhere such as Oregon where there is no sales tax and then buy something in California or Washington, all they need to is provide proof of residence and the seller of the item is required by law to not charge them sales tax because Oregon has no sales tax. The theory is the item(s) are not going to remain in the state. That, in fact, is one of the ways something is trying to get done on a national basis for online sales. Then again the federal government is technically not given the power to enforce such laws which manage interactions like this between states...even interstate commerce does not have any black and white in this area.
I know it's weird and convoluted but it worked well for decades, remember we did not have the sort of tax system as we have today until just before WWI, though several attempts happened before then, even a national flat tax in the late 1800's.
FYI here is a fairly accurate page wrt to taxes here in the US that will always give a good reference for you w/o any political bias. Well mostly no bias, if that is actually possible,
http://www.treas.gov/education/fact-...es/ustax.shtml