Sales Tax on Coins - Tennessee

[sin-n-dex]

I don't have a Tennessee sale since before this law came into effect, but a buyer sent me this:

SUT-121 - Bullion or Precious Metal Coins
This article has been updated to reflect a law change.

Effective May 27, 2022, there is a sales and use tax exemption for the sale of all coins, currency, and bullion that are:

manufactured in whole or in part from gold, silver, platinum, palladium, and other material;
used solely as legal tender, security, or commodity in Tennessee or another state, the United States, or a foreign nation; and
sold based primarily on their intrinsic value as precious material or collectible items rather than their representative value as a medium of exchange.

He tells me he wants to purchase three Australian $10 silver coins from the 1980s (0.925 silver I think). He said it should be tax exempt and it is from other sellers, but not in my store. I don't have anything to do with adding or removing taxes from the checkout, and he doesn't want to go ahead and try and buy and see what happens because it's showing him taxes are owed (which he claims doesn't happen when he buys other coins from other sellers).

Any idea on why the taxes are showing up?

C.

[luckythewinner]

Any idea on why the taxes are showing up?

Has your buyer indicated whether he has successfully purchased from other eBay sellers where sales tax was correctly exempted?

[4pawsup*]

He is right there are no taxes on precious metals ie coins and bullion. Ebay adds tax and its not right. The buyer should contact ebay as the seller has no control over taxes being applied at checkout.

[sin-n-dex]

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@luckythewinner wrote:

Any idea on why the taxes are showing up?

Has your buyer indicated whether he has successfully purchased from other eBay sellers where sales tax was correctly exempted?

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He said taxes were exempted from other sellers, but does not appear to be exempted from me.

I'm wondering if there's something I did to the listing which makes eBay think it's supposed to charge tax. I just don't know enough about this to look into it myself, as there are no Tennessee sales in my sales history at all after this took effect in 2022.

C.

[sin-n-dex]

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@4pawsup* wrote:

He is right there are no taxes on precious metals ie coins and bullion. Ebay adds tax and its not right. The buyer should contact ebay as the seller has no control over taxes being applied at checkout.

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The Australian $10 is in the Australia Commemorative category, which can include things like packaged sets and collectible coins which are probably not tax exempt. (Some coin categories permit EIS shipments, but coins aren't supposed to be shipped via EIS at all, I'm wondering if this issue is similar, to do with the category).

C.

[luckythewinner]

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@sin-n-dex wrote:
I'm wondering if there's something I did to the listing which makes eBay think it's supposed to charge tax. 

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Or conversely, there might be something MISSING from your listing that prevents eBay from detecting that it should not charge tax. 

You could try searching other similar listings with your shipping zip code set to a Tennessee zip code and find someone where it is tax exempt. Then examine the item specifics of that listing to see what might be missing or incorrect on yours. 

In other words, read the law carefully and make sure your item specifics are sufficient for a bot to determine it meets the law's criteria. 

[sin-n-dex]

OK, I think I made some discoveries on this.

One of the coins in question had EIS shipping to Canada (the template I use for packaged stuff is for USA shipping only, but because it's packaged stuff, EIS will ship it to Canada and elsewhere).

When I deleted the words "presentation pack" from the description and changed the category from commemorative to decimal, the EIS shipping to Canada disappeared and I'm assuming the taxes to Tennessee will as well.

Waiting for my buyer to confirm, but I do think I'm on to something about the category determining EIS shipping and taxes (whether they apply), so that's good to keep in mind when listing. All my non packaged coins (packaged in flips) have international and Canadian shipping applied for direct shipping, so there was no way to check this, I had to revise the listing in question to see if anything changed.

C.