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Impact of sales taxes

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Impact of sales taxes  Reply with quote  

Sales taxes can be applied to tangible goods like food (in some states), clothing, cars, furniture, household items, and other goods. By comparison, the sales tax does not generally apply to landscaping services, attorney fees, private school tuition, stocks and bonds, real estate investments, and other purchases more typically made by higher-income families.

A seller has to charge sales tax if it has 'nexus' where it is located. Nexus, or physical presence, is established if a business maintains a temporary or permanent presence of people (employees, service people or independent sales/service agents) or property (inventory, offices, warehouses) in a given locality. There is no over-arching definition of nexus, so each taxing locality may define it differently - and many do, leading to endless problems for businesses which have operations in multiple states.

All the products are subject to sales tax, and states offer different exemptions for this. Food, clothing, pharmaceutical products, purchases for agricultural are commonly excluded. The rates of sales tax may also vary within a state for different types of business.
Post Mon Apr 26, 2010 5:04 pm
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Buying and selling a business can be structured to be tax free from the standpoint of federal income taxes through the merger and other reorganisation provisions of the Internal Revenue Code.
Sales tax where six requirements are met:
1. a sale
2. at retail
3. by a retailer
4. of tangible personal property
5. within California
6. for which, no sales tax exemption exists.
A "sale" is defined as "any transfer of title or possession, exchange, or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration. "At retail" is defined as " a sale for any purpose other than resale in the regular course of business in the form of tangible personal property."
A "retailer" includes every seller who makes any retail sale of tangible personal property and every person engaged in the business of making sales for storage, use, or other consumption. The sales tax is also imposed where more than two "retail sales" are made within a 12-month period.
Post Wed Oct 20, 2010 9:40 am
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Seller to include "every person who participates in the business of selling tangible personal property of the kind of total revenues from the sale of retail that are required to be included in the measurement of the sales tax. Or not never sold the property. In the retail trade." In other words, the retailer does not need to be in the actual work to make retail sales but only in the business of selling property that would be a retail sale if sold in retail.Sales law exempts tax on the use of the service of the industries most definition of "seller : "accounting, law, and the laundry, vacuum, and transportation companies. Also, legally exempt sales of food products from the definition of "retail sales".
Post Sat Dec 04, 2010 6:20 am
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Local governments are under pressure to develop other revenue sources at their base property tax. Among their responses has been an increased reliance of local sales tax.
Post Thu Dec 30, 2010 6:08 am
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