Americans like surprises. Actually, most of us just know our local sales tax rates and apply guesstimation on big ticket items (âit says $90, but thatâs like almost $100 with taxâ). Honestly, I donât know why the price tags donât include tax, especially when some items are taxed and others arenât. E.g., essentials (food, diapers, etc.) are often not taxed or taxed at a lower rate.
On the other hand, the price of gasoline does include the tax and pumps usually have decals informing consumers exactly how much fuel/road tax they are paying per gallon. Because weâre nothing if not inconsistent.
I am also. I just hit my state dept of taxation website. Sales tax only applies to tangible goods. âDigitally deliveredâ goods are specifically exempted from both sales and use tax and consumer use tax.
Anyone concerned about their own situation should refer to their stateâs department of taxation or department of revenue, and review the stateâs sales and use tax guidelines.
I was going to make a list of states that tax digital sales, but it was easier to make a list of those that donât (I was surprised how many do). The ones that definitely donât (per the tax source I found) are:
Alaska
California
Delaware
Florida
Illinois
Kansas
Missouri
Montana
Nevada
New Hampshire
North Dakota
Oklahoma
Oregon
Virginia
West Virginia
There are several states that donât tax some digital goods, but do tax others (including software). These include New York, Michigan, Massachusetts, and South Carolina. In those states and elsewhere, residents should refer to their DOT/DOR for details.
The thinking is that tax rates are âhiddenâ when included in the advertised price. People canât get upset and belligerent over a tax hike if they donât know itâs happening. We have grown up with it here, and for the most part expect to calculate sales tax when we consider a purchase.
I live in the US, but thatâs very fair. If you cant sit in your own country and pay for digital service in your own currency, somethingâs very wrong.
For the education of some here who donât seem to understand how sales tax works:
In the U.S., the sales and use tax rate (and what it applies to) is determined by your state legislature. In Canada, youâve got PST at the provincial level, and GST/HST at the federal level. In either case, these taxes are imposed by your elected officials. If you donât like those taxes, make different choices at the ballot box or move to a place more inline with your values.
That said, businesses collect sales tax in accordance with the law. And to be clear: they remit those collected taxes to the taxing authority. They donât get to keep the money.
CCP doesnât profit at all from collecting sales tax. On the contrary, it costs them in the form of staff or outside tax services, because some accountant somewhere has to file CCPâs tax receipts with those 45+ different state, provincial, and federal governments. Each one of them has their own system for doing that, and itâs a lot to keep up with. As a small business owner myself, I can tell you CCP would rather not do this if they had any choice in the matter.
So to those asking for a discount to offset the sales tax: youâre high. If CCP leaves the subscription rate as-is, they will be eating the additional overhead to collect and file taxes on behalf of almost 50 different revenue agencies. By them not passing that cost on to their customers, youâre already getting a de facto discount.
Actually, most of us just know our local sales tax rates and apply guesstimation on big ticket items (âit says $90, but thatâs like almost $100 with taxâ). Honestly, I donât know why the price tags donât include tax, especially when some items are taxed and others arenât. E.g., essentials (food, diapers, etc.) are often not taxed or taxed at a lower rate.
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