Excessive Sales (Use) Tax

[beercitysavage]

The itemized sales taxes for a recent purchase reflected not only the tax for the cost of the item, but also tax on shipment of the item.  This is improper for purchases made by residents of and sent to addresses in the State of Illinois. If a seller includes "free" shipping in the cost of an item, the sales tax would be on the listed price. However, if the shipping is called out separately from the item price, the State of Illinois does not consider the shipping cost as taxable. For example, if I pay $14.00 for an item that includes free shipping, and my total (state + municipal) tax rate is 10%, I should pay and additional $1.40, i.e., a total of $15.40.  By contrast, if I pay $10 for and item and am going to be charged $4.00 for shipping, I should pay $10.00 (for the item) + $1.00 (10% sales tax on the cost of the item) + $4.00 for shipment of the item, i.e., a total of $15.00.  Who is responsible for correcting this, the seller or eBay?

[wooden_flower]

Shipping and handling charges are taxable when:

• The transportation and delivery charges are not separately identified to the purchaser on the contract or invoice or
• The transportation and delivery charges are separately identified to the purchaser on the contract or invoice, but the seller does not offer the purchaser the option to receive the property in any manner except by delivery from the seller (i.e., no pick up option is given).

See Illinois Administrative Code,  Section 130.415  for more information.

https://www2.illinois.gov/rev/questionsandanswers/Pages/144.aspx