Taxes on Purchase


(Tommy Rayburn) #1

Curious to the tax on my recent purchase because I don’t think there is a SmartThings store nor a sales representative in my state (VA), but I may be wrong.


#2
  1. Online retailers can collect taxes for the state in which you reside and sent the taxes back to the state. Virginia requires that retailers that have a “sufficient nexus” to virginia to collect sales tax. Smartthings used to have an office in Washington, DC (I think its been closed since the Samsung acquisition), so that may meet the “sufficient nexus” requirement.
  2. Even if the online retailer does not collect taxes, you are still required to pay a use tax per VA state law if you have over $100 worth of out of state purchases per year:
    http://www.tax.virginia.gov/site.cfm?alias=ConsumersUseTax

When you purchase goods, other than magazines or newspaper subscriptions, from a business that does not add the Virginia sales and use tax to your bill or you purchase goods tax-free while outside Virginia, you may be liable for the tax and required to file Form CU-7 to report and pay the tax.


(Tommy Rayburn) #3

That’s why I asked. I just recently made a purchase from NewEgg and did not pay taxes.


(Chrisb) #4

I don’t think it’s going to be too much longer until this becomes a requirement across the nation. Honestly, it’s a loophole right now and lots and lots of tax dollars are going out the window that states would love to get their hands on.

That Online retailers can… part is going to become a Online retailers are required to… very soon in my opinion.


#5

We have a nexus in Virginia. Our headquarters are currently in Washington, DC (but transitioning to Palo Alto).


(Tommy Rayburn) #6

Okay, as long as there is a reason I am getting taxed and it isn’t some odd hidden fee, I am fine with it.


(Edward Pope) #7

I live in VA, and I know that they are forcing many retailers to pony up now. Frankly, I understand as it is loss revenue for the state, and just as importantly it brings the prices more in line with Local Retailers as well. Although Sadly, most of the people I know who do local shopping do not buy from the small shops, but rather the big boxes (WalMart, Target, etc.)


(Edward Pope) #8

Well, that explains it… And, just be glad that you did not get the D.C. tax (SMILE)