How does sales tax works? Sales & Returns between counties.?

Question

I am curious about how sales tax works. If I purchase an item from city A and return it in city B, which city gets the sales tax? Does this mean that the tax revenue goes to city A and city B loses the revenue from the return?

Answer 1

Genneraly for returns a company requires you do at the same store. But they will allow you to exchange a product , for something similar, and then the first county/state gets the sales tax.

Answer 2

In a perfect world the retailer should pay you back exactly what you paid and nothing more or less. They then need to alert their accounting folks that the return was for a purchase in another county and the tax gets adjusted between the two taxing jurisdictions.

However in many cases the retailer will run the return through their sales system where you are returning the item and give you whatever the system says you are due. In these cases City B is losing funds that City A should not get.

Answer 3

The county you purchase an item from usually is entitled to the tax on the item. If you return the item to a store in another county, that store is giving you a convenience, but should have the item credited back to its source of purchase for tax purposes. Taxes on some more expensive items should be paid in the state where your reside. This is true for automobiles and furniture. You can tell the sales person to hold the tax and you will pay it in the county you live. In many cases, your residence is the determining factor for payment. Some guidelines are referenced in the source.

Answer 4

tax is state Federal,sails tax.property taxes.Each one gos to the
proper.tax collector.sails taxes go to the state,city tax go to the city, Federal go to the Federal garment