Sales tax and coupons MUST READ ~ Thanks!

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If you live in a state that does NOT charge tax on coupons but you shop at a store that is doing it anyway ... report it!

http://www.courthousenews.com/2012/01/06/42812.htm I shop at Home Depot with coupons sometimes and they ALWAYS charge tax on the coupons even though the state of MO says they are not suppose to. I've written them letters and even written to the MO Attorney General. Now there is a class action suit ... maybe they'll listen and STOP charging tax. Email me if you'd like to chat about it. Especially if you live in CT, MA, PA, or TX and have shopped there and they have charged you tax!

Thanks ~ Sandy

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NOT odd. Staples Rewards are a store coupon and treated like that. At WG, I assume you are talking about Register Reward... (more)

billrubin (Jan. 11, 2012 @ 11:30a) |

Yes in NJ. Store coupons no, however...

rsuaver (Jan. 11, 2012 @ 10:22p) |

Store coupons should not be taxable ANYWHERE.

billrubin (Jan. 12, 2012 @ 1:22a) |

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I live in PA and have never been charged tax on a coupon. If I go to Home Depot and buy something for $100, and drop it to $90 with a 10% off coupon, the tax would be 6% of $90 or $5.40. To charge tax on $100 would be ludicrous. Is that what is happening to you, SandyBarber?

stevelion said:   I live in PA and have never been charged tax on a coupon. If I go to Home Depot and buy something for $100, and drop it to $90 with a 10% off coupon, the tax would be 6% of $90 or $5.40. To charge tax on $100 would be ludicrous. Is that what is happening to you, SandyBarber?The issue here is manufacturer's coupons (like the grocery coupons in the Sunday paper or that you can print online). The 10% off coupon you are describing is a store coupon and those are never taxable anywhere because they are considered a store discount.

I know that Staples has their cashiers ring manufacturer's coupons up differently in states where they are not taxable; there is a special 5 digit Staples coupon code that they enter so it gets processed before the order is totaled (and tax calculated).

The only complaint I have with Costco is that they charge sales tax on the "pre-discount" price. For example: If they have a TV for sale for $649.99 - "Mfg instant rebate" of $100.00 that takes the price down to $549.99, they charge you tax on the $649.99 amount

having worked in retail, we did coupons a couple different ways. We treated manufacurer coupons as a form of payment, and therefore charged tax on the entire amount. We used our coupons as a discount, and therefore it reduced the amount of the individual item. Haven't worked there in 6 years, and am not a shill, but that was the way that we applied the coupons.

Having said that, i believe that was the way that we tried to apply the coupons. On the first day or so of the sale, we would have one or more which was not ringing up correctly, and we would send it in to get it fixed.

Thanks for the replies ... Stevelion ~ I went to Home Depot and I bought 4 Mr. Clean Magic Erasers @ $1 each and I had 4 $1 MFG coupons. RSMo 144.083 says they charge tax after the coupons. My total was zero and NO tax should have been charged. They charged me .30. I wrote to them and they said that's the way it was suppose to be done. I sent them a copy of the RSMo and they still said that was the way it was suppose to be done. I wrote to the MO Attorney General and he wrote them a letter. They called me and STILL said they were doing it the correct way. Now ... there's a class action suit against them!

Costco always makes me pay sales tax on the item before the coupon. I even pushed this to the customer service counter, where I was told, "We're not going to pay sales tax for you, sir." I specifically recall it being an $80 coupon (from Costco) to reduce the price on an exercise bike.

I figured it was because Costco does not accept "coupons" other than their own -- figured there was some sort of thing that didn't apply to them and taxes, so that they could collect tax on the full cost of the item.

bbrodie said:   The only complaint I have with Costco is that they charge sales tax on the "pre-discount" price. For example: If they have a TV for sale for $649.99 - "Mfg instant rebate" of $100.00 that takes the price down to $549.99, they charge you tax on the $649.99 amount

A rebate is taxable because it does not change the amount you pay the merchant. A discount coupon will vary with state law. The bigger question is whether the merchant remits the extra sales tax to the state or keeps it. Merchant in Texas was caught about 20 years ago doing just that.

If every state were to follow the Supreme Court ruling in Maryland vs Louisiana http://supreme.justia.com/us/451/725/ on taxation of interstate commerce and Pennsylvania vs West Virginia http://supreme.justia.com/us/262/553/ on the exact point where state authority takes over, we would have to have clerks input our zip+4 at the register to determine the exact amount of sales tax. For example a merchant in Dallas sells and ships an item to Brewster county some 500 miles away. The US Supreme Court says that tax should be charged AFTER the item leaves interstate commerce not before. The shipping from Dallas to Brewster county is still in interstate commerce as per Pennsylvania vs West Virginia. State taxable jurisdiction occurs when the item arrives at your house ending its journey in interstate commerce. Congress had to pass the Hindshaw amendment to the Natural Gas Act to allow states to regulate the interstate transportation within and ending in the state of Pennsylvania. Congress has passed no such law allowing state taxation during transit. Quite to the contrary. This has been the law since 1923, do states follow it? Not if they don't get caught. In my example the Dallas Transit system and the City of Callas each collect 1% sales tax that they are not entitled to have. Why because the State of Texas says do it that way not because it is legal.

nsdp said:   bbrodie said:   The only complaint I have with Costco is that they charge sales tax on the "pre-discount" price. For example: If they have a TV for sale for $649.99 - "Mfg instant rebate" of $100.00 that takes the price down to $549.99, they charge you tax on the $649.99 amountA rebate is taxable because it does not change the amount you pay the merchant. An instant rebate does change the amount you pay the merchant.

Another reason to get rid of the [deleted] sales tax. Since PA was raised here, I remember when the PA tax was pushed by the Party of Socialism as a "temporary" measure.

From my experience in IN coupons have always been taken off after the sales tax is applied. I don't like it, but I've always seen it done that way here. I have no idea if there are IN state statutes that directly address this issue.

snork615 said:   Another reason to get rid of the [deleted] sales tax. Since PA was raised here, I remember when the PA tax was pushed by the Party of Socialism as a "temporary" measure.

Just like income tax was a temporary measure.... history repeats..

In Nevada at Save Mart Grocery store, I had saved up the "stamps" to get a "free" frying pan. However, had to pay tax on the full retail value of the Frying pan.

A local store charges tax on newspapers, I have told them a 100 times they cant
They have no idea what freedom of the press means ( FREE FROM TAX )

Is Manufacturer's coupon taxable in NJ/NY?

The only store I found doing it incorrectly in Texas is Target. If you buy a $2 item with a $1 coupon you pay tax on the $2. This goes against Texas law. As to whether this is something I could sue Target for I'd doubt it. The store doesn't keep the tax, in fact, it costs them money in higher credit card fees. Now, I do notice many stores charging sales tax on tax exempt items -- for example, I was charged sales tax at Lowes for vegetable seeds which are tax exempt in Texas.

collecting tax
not
charging tax

Are sales taxes collected supposed to be collected on pre-MFC or post-MFC prices in CA? I find it problematic when it seems that coupons that scan through at Rite Aid reduce the tax base of the transaction but coupons that have to be manually entered do not. Also odd that some places (such as Staples) have it where applying rewards credit towards a transaction will reduce the tax base but other places (Walgreens) do not have it that way.

EDIT: never mind my dumb self... I looked at my last RA receipt and apparently even properly-scanned coupons don't reduce the tax base of the transaction. Maybe it's just me, but if coupons are treated by stores as a method of payment as opposed to a discount, shouldn't coupons have protections that gift cards have (such as not expiring)? One can dream

lonestarguy said:   The only store I found doing it incorrectly in Texas is Target. If you buy a $2 item with a $1 coupon you pay tax on the $2. This goes against Texas law. As to whether this is something I could sue Target for I'd doubt it. The store doesn't keep the tax, in fact, it costs them money in higher credit card fees. Now, I do notice many stores charging sales tax on tax exempt items -- for example, I was charged sales tax at Lowes for vegetable seeds which are tax exempt in Texas.

+1 Target does an excellent job calculating sales tax. If you purchase a $100 item and it comes with a free $10 gift card your total will be: $105.40 (at 6% sales tax)

The sales tax is actually deducted for the $10 gift card at the time of original purchase. Most stores fail to do this, even though when you redeem the free gift card you have to pay sales tax on that transaction....

i.e. Otherwise although you pay $100 for $110 in merchandise, most stores still charge you sales tax on $110. - You pay sales tax on $100 in the first transaction, and sales tax on $10 when you redeem the gift card. Most states require sales tax to be charged on the amount paid. Good job target for following the law....

It depends whether your state considers coupons a cash payment (tax charged on the full value), or a cash discount (cash charged on the net, or discounted value).

You know if you sued them in Small Claims court you would get more money than a class action?

http://www.npr.org/blogs/thetwo-way/2012/01/05/144749987/calif-w...

sap283 said:   Is Manufacturer's coupon taxable in NJ/NY?Taxable in both.

bjork73 said:   Also odd that some places (such as Staples) have it where applying rewards credit towards a transaction will reduce the tax base but other places (Walgreens) do not have it that way.NOT odd. Staples Rewards are a store coupon and treated like that. At WG, I assume you are talking about Register Rewards. If you look at those, you will see that they are actually manufacturers coupons.

CVS used to treat Extrabucks as a store coupon and you would not be taxed when using them. They changed that over a year ago (I'm guessing they got complaints from states missing out on sales tax revenue from people who kept rolling their ECB). Now the only ones that are not taxable are a) the $1 for using the green bag tag, and b) raincheck ECB. Those are still treated as store coupons and are not taxable.

sap283 said:   Is Manufacturer's coupon taxable in NJ/NY?

Yes in NJ. Store coupons no, however...

rsuaver said:   sap283 said:   Is Manufacturer's coupon taxable in NJ/NY?
Yes in NJ. Store coupons no, however...
Store coupons should not be taxable ANYWHERE.



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