Taxed Twice M2M Thread

[mr_lincoln]

I saw this post on the M2M board ...

I agree 110% that "used" items, collectibles, antiques, etc ... meaning any thing that isn't "current and new" should NOT be subject to sales tax.  The sales tax was paid at the original point of purchase (except in Delaware) so the state got their cut then ... charging tax again on these items is at a minimum Double Taxation ... time to throw something other then Tea into the Boston Harbor ... can I get an "Amen?"

[mam98031]

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@soh.maryl wrote:

Just curious:  How does the state keep track of how many garage sales any one person has in a year and how do they know how much state sales tax to charge? So they charge it to the seller?

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Some cities and/or states require a licence / permit to have a garage sale.

[mam98031]

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@trukur_0 wrote:

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@hillbillymedia wrote:

I also agree. In many cases it`s way more than paying the tax twice. On older, vintage items the item may have had many, many owners. When you get up into the larger items like cars, homes, etc. this equates to big money.

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True but the seller doesn't pay the tax, the buyer does.

The seller paid the tax when he was a buyer, but now he is the seller.

If I am the seller I only paid the tax when I bought the item.

Sellers do not pay the tax when selling, the buyer does.

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Except the seller doesn't pay sales tax if they bought the item for resale and has the appropriate license / certificate to claim tax exempt.

[mg152 · Accepted solution]

Amen! I agree with you.

[mr_lincoln]

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@mg152 wrote:
Amen! I agree with you.

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Thanks for the AMEN!  Love it!!!!!

[mr_lincoln]

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@mam98031 wrote:

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@soh.maryl wrote:

Just curious:  How does the state keep track of how many garage sales any one person has in a year and how do they know how much state sales tax to charge? So they charge it to the seller?

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Some cities and/or states require a licence / permit to have a garage sale.

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BINGO!  When we first got married we rented an apartment in a small town and learned that in order to have a garage, yard or porch sale you had to get a permit AND you were ONLY allowed 3 per year ... the cost was I think $ 5 or $ 10.  They did this because too many people would simply put their stuff out every week and try to sell it, basically running small businesses ...

[soh.maryl]

Yes, I understand that some cities/states require a permit for a garage sale.

But what department of the city or state enforces that rule?

So the garage seller would have to keep track of how much he sold in order to pay tax on the total? What keeps him from reporting much less than he made?

Not trying to be argumentative, just wondering how this would be enforced?

In most localities that I've lived in, the majority of yard or garage sales are on a weekend.  So would it be worth it to the city to have someone drive around on the weekend to check for sales or permits? 

In my town, you are supposed to buy a permit for $5 at city hall.  It's good for one weekend.  They did this to stop those people who have one absolutely every weekend, but, again, don't know how or why they could enforce it unless neighbors complained to law enforcement.

[the*dog*ate*my*tablecloth]

The Boston Tea Party wasn't strictly about high taxes, it was a demonstration against “taxation without representation”. Britain charged the Colonies taxes on tea but the colonials were not allowed to vote in British elections. As long as you’re a citizen here you can vote so you have representation.

Also if double taxation was against the law, how would states and the federal government both tax on the same income?

These sales tax laws have been in place for decades and I’ve been taxed on used items like cars for as long as I can remember.

[7606dennis]

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@soh.maryl wrote:

Just curious:  How does the state keep track of how many garage sales any one person has in a year and how do they know how much state sales tax to charge? So they charge it to the seller?

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Many cities require people holding a garage sale to obtain a permit.  Ours allows four per year.  To hold one without a permit subjects one to arrest and fine.  

[mam98031]

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@soh.maryl wrote:

Yes, I understand that some cities/states require a permit for a garage sale.

But what department of the city or state enforces that rule?

So the garage seller would have to keep track of how much he sold in order to pay tax on the total? What keeps him from reporting much less than he made?

Not trying to be argumentative, just wondering how this would be enforced?

In most localities that I've lived in, the majority of yard or garage sales are on a weekend.  So would it be worth it to the city to have someone drive around on the weekend to check for sales or permits? 

In my town, you are supposed to buy a permit for $5 at city hall.  It's good for one weekend.  They did this to stop those people who have one absolutely every weekend, but, again, don't know how or why they could enforce it unless neighbors complained to law enforcement.

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It is like any other rule or law.  Some will skirt around it somehow, some will honor the laws / rules.  It is up to each jurisdiction as to if they are going to actively enforce this or not.  

[7606dennis]

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@soh.maryl wrote:

Yes, I understand that some cities/states require a permit for a garage sale.

But what department of the city or state enforces that rule?

So the garage seller would have to keep track of how much he sold in order to pay tax on the total? What keeps him from reporting much less than he made?

Not trying to be argumentative, just wondering how this would be enforced?

In most localities that I've lived in, the majority of yard or garage sales are on a weekend.  So would it be worth it to the city to have someone drive around on the weekend to check for sales or permits? 

In my town, you are supposed to buy a permit for $5 at city hall.  It's good for one weekend.  They did this to stop those people who have one absolutely every weekend, but, again, don't know how or why they could enforce it unless neighbors complained to law enforcement.

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Most cities and counties have code enforcement officers but any law enforcement officer could decide to check one's permit.  Of course, neighbors do file complaints. They do so usually when one's yard sale causes traffic congestion by people attending it blocking their driveways, etc.

[mr_lincoln]

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@soh.maryl wrote:

Yes, I understand that some cities/states require a permit for a garage sale.

But what department of the city or state enforces that rule?

So the garage seller would have to keep track of how much he sold in order to pay tax on the total? What keeps him from reporting much less than he made?

Not trying to be argumentative, just wondering how this would be enforced?

In most localities that I've lived in, the majority of yard or garage sales are on a weekend.  So would it be worth it to the city to have someone drive around on the weekend to check for sales or permits? 

In my town, you are supposed to buy a permit for $5 at city hall.  It's good for one weekend.  They did this to stop those people who have one absolutely every weekend, but, again, don't know how or why they could enforce it unless neighbors complained to law enforcement.

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This is similar to what I posted ... Neighbors complained in the borough we lived in because people were running a weekly business out of the yard, garage or off their porch ... so it initially self policed so to speak.  The permits issued had to be displayed the week of the sale, not the day before, the week before, plenty of time for the local constable to drive by and check the neighborhood to see who was having a sale ...

[7606dennis]

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@mr_lincoln wrote:

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@soh.maryl wrote:

Yes, I understand that some cities/states require a permit for a garage sale.

But what department of the city or state enforces that rule?

So the garage seller would have to keep track of how much he sold in order to pay tax on the total? What keeps him from reporting much less than he made?

Not trying to be argumentative, just wondering how this would be enforced?

In most localities that I've lived in, the majority of yard or garage sales are on a weekend.  So would it be worth it to the city to have someone drive around on the weekend to check for sales or permits? 

In my town, you are supposed to buy a permit for $5 at city hall.  It's good for one weekend.  They did this to stop those people who have one absolutely every weekend, but, again, don't know how or why they could enforce it unless neighbors complained to law enforcement.

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This is similar to what I posted ... Neighbors complained in the borough we lived in because people were running a weekly business out of the yard, garage or off their porch ... so it initially self policed so to speak.  The permits issued had to be displayed the week of the sale, not the day before, the week before, plenty of time for the local constable to drive by and check the neighborhood to see who was having a sale ...

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You realize that a permit or license fee is, in essence, a form of taxation.  

[luckythewinner]

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@mr_lincoln wrote:

The sales tax was paid at the original point of purchase (except in Delaware) so the state got their cut then ... charging tax again on these items is at a minimum Double Taxation ... time to throw something other then Tea into the Boston Harbor ... can I get an "Amen?"

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You'll get no "Amen" from me.

The difference between a product and a sale  is that one is a thing and one is an activity. 

A sales tax is a tax on the activity, not the product. 

[nc-daydreamer]

I used to live in a state where you had to have a permit to have a yardsale, and forbid it should rain.  Heck, even kids had their lemonade stands taxed.  

[mr_lincoln]

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@luckythewinner wrote:

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@mr_lincoln wrote:

The sales tax was paid at the original point of purchase (except in Delaware) so the state got their cut then ... charging tax again on these items is at a minimum Double Taxation ... time to throw something other then Tea into the Boston Harbor ... can I get an "Amen?"

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You'll get no "Amen" from me.

The difference between a product and a sale  is that one is a thing and one is an activity. 

A sales tax is a tax on the activity, not the product. 

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Semantics ... the Superman Socks that sold at Ben Franklin's when they were new in 1979 were taxed then and if resold today on eBay would be taxed again ... I think you and some others know what I am talking about ... the item is taxed twice in this example and I don't agree with it ...