I live in Indiana (6% sales tax), and was in an ice cream store. I've frequented the store in the past year, enough to have six stamps on a coupon that said "Buy 6 Regular Cups, Receive the 7th Free." So I turned in my coupon to the woman, she rang it up, and I started to leave. She asked me to wait while she tried to figure out how to ring it up... and when all was said and done, she said I owed her $.30 in tax, on a $4 dish of ice cream I was supposed to receive for free. Not only was the tax she asked me to pay more than I would have paid if I had bought the ice cream dish myself, but sales tax should only be charged, to my knowledge, for any amount of money paid for a good.
I believe I'm correct in my assumptions, and that what the manager did was illegal (I gave her $.30). I want to write the company and inform them, but I don't know enough about tax law to be sure what I'm saying is infact, illegal. I need information to back up my belief--- can anyone help?
2007-12-06 06:33:42 · 10 answers · asked by Jena 2 in Business & Finance ➔ Taxes ➔ United States
I know it's not a big deal--- I'm not broke over $.30, but it's the principle of the thing. Thanks for good responses so far!
2007-12-06 07:12:48 · update #1
get over it and enjoy your ice cream!
2007-12-06 06:38:11 · answer #1 · answered by union de tvla, jalisco 2 · 0⤊ 1⤋
No, actually you aren't correct. If you get an item free or at a reduced price because of a coupon (or the punch cards like you had) in most states sales tax is due on the full price. But 6% of $4 is only 24 cents, so that should have been what she charged you unless there's some local sales tax to account for the other 6 cents.
2007-12-06 09:30:11 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
well, most states do have tax laws they have to abide by, even for free stuff. A good example is when you watch those tv shows where people win money. they dont ever get the entire amount, they have to pay taxes on that. getting back to your scenario, if the ice cream cup you got free is valued at $4 exactly and the sales tax is 6% then you were suppose to pay 24 cents, not 30 cents! 4(.06)=0.24 those few cents wont make a difference but its a matter of principal, since you have been a loyal customer a nice thing for them to have done for you is cover the 24 cents. but as they are abiding by the law, so shall you, and go back and demand 6cents back from them. its only fair. Imagine if they unfairly took 6 cents from each customer going in there. it would add up quick. businesses short change customers more often than you think.
2007-12-06 06:51:27 · answer #3 · answered by in the valley 1 · 0⤊ 0⤋
I live in NJ and get a lot of free items in NY and NJ, none of which I pay sales tax for. However, recently I received a free hotel night and was asked to pay for the taxes. I really couldn't complain since it was free and I was only paying like $20 for the night in a prime location. This was not the first free hotel night I have received but the first one that I was charged tax for. Looking at the fine print of the offer, I did notice that I was responsible for the tax. I could understand this since the hotel was reimbursed for the free night by the franchise but the hotel tax still needs to be paid to the state. Could be the same for the free ice cream. If the store rang it up with taxes, it is possible that the franchise only reimburses the store for the product, not the taxes.
2007-12-06 13:06:28 · answer #4 · answered by fredo 2 · 0⤊ 0⤋
You are stressing out too much over $.30, but to answer your question, they would most likely ring up the ice cream as usual (adding the tax, of course), and because you are entitled to a free ice cream, they would deduct the price of the ice cream only, which would then leave the tax to be paid. It isn't a big deal.
2007-12-06 06:43:01 · answer #5 · answered by legalchick791 5 · 0⤊ 0⤋
I would suggest that you contact the State of Indiana's Department of Revenue for a bona-fide answer.
Personally, I don't think that you should have been charged sales tax, albeit, it is a small amount, but nevertheless, a principle is a principle.
Surely, the State of Indiana has a web site where this information may be available.
Good luck and let us know how you make out.
2007-12-06 06:51:25 · answer #6 · answered by RUSerious 7 · 0⤊ 0⤋
Logic: I bought 12 items and received the 13th free which no sale was made. If no sale was made then you should not pay sales tax. Duh!
2016-07-05 11:18:23 · answer #7 · answered by Walter 1 · 0⤊ 0⤋
Some states levy tax before any discounts are taken. Others do so after discounts are taken. You'd have to check with the state. However it should not have been any more than what the full-price tax would have been.
2007-12-06 06:48:02 · answer #8 · answered by Bostonian In MO 7 · 0⤊ 1⤋
I believe that Indiana does tax "free" items.
2007-12-06 06:51:13 · answer #9 · answered by Wayne Z 7 · 0⤊ 0⤋
I don't practice in IN, but if the laws there are similar to the ones I'm familiar with the clerk was correct.
2007-12-06 06:48:39 · answer #10 · answered by taxreff 7 · 0⤊ 0⤋