How can this be ?

[smstonypoint]

Back in 2005, I almost bought a tractor in Mount Airy but to "match" the price I got in VA (with tax), they were going to sell it without NC tax and deliver it to VA. I said no thanks... and bought it in VA. (just didn't have a warm fuzzy feeling with those guys...)

Comfort level with a dealer is paramount, but the proposal from the NC dealer may have been legal at the time. If VA has a "use" tax, the onus would have been on you to report the purchase and pay the VA sales tax.

Steve

 

[CHDinCT]

All states require you to pay a use tax for out of state purchases because they can't impose the duty to collect sales tax on an out of state vendor - no jurisdiction if you will. But, enforcement of state use tax laws is difficult since it mostly rests on the buyer voluntarily reporting the purchase, except for something like a car where you have to register it in your home state.

 

[Porkie]

Missouri doesn't impose sales tax on farm equipment.

Sam

 

[rjkobbeman]

Do they have a store also in Virginia? Up here if a company also operates in the state you are from they will charge you sales tax if they have to deliver to that address.

That is the law. A business is required to collect sales tax for all states that they have a presence (if those states have sales tax).

OPTIONALLY, a business can collect sales tax for any/all states that have sales tax.

They of course have to send that tax money to the states.

 

[rd_macgregor]

I have no legal background, but it seems to me that, depending on the specifics of the businesses involved, this could be a violation if the commerce clause (Art.1, sec.8 of the constitution). Mail-order businesses have thrived in the US in part because interstate sales were constitutionally exempted from state taxes.
States have been chipping away at this advantage, though. First, they can charge "use" taxes. This is most effective with something like a motor vehicle which has to be registered; something that you use in your home (or the back 40!), is harder to tax.
Another (and easier to justify) way to undercut the commerce clause is to charge a tax on items from a company that has an outlet in your state. So, if you could as easily buy an item from your local retail Sears store as mail-order it from Sears, the state says mail-order is just tax avoidance.
The case of an independent tractor dealer doesn't seem to fit the second example, though.
There are usually several dealers monitoring this forum, so maybe they'll speak up and clarify how this works for out-of-state sales.

BOB

 

[PILOON]

Another consideration.

Did you pick it up? if so you took possession in that state and need to remit there.

If they delivered out of state (and have no presense in your state) then they probably would not be liable for collection. (unless the 2 states have an agreement) but the onus is then on you to declare and remit to your home state.

My busness was in Montreal and we'd often ship boxes 'out of state, country' to buyers residence to help out the buyers. This is legitimate. The onus is on buyer to remit home taxes.
(They could claim rebates and re-pay their home taxes, but that was long and complicated. I naturally assumed they would promptly remit once thay got home. LOL)

In the case of a tractor the vendor would need to have a bill of lading on file to prove his 'non collection of state taxes' othewise he would be liable to remit.

 

[BXpanded]

Another consideration.

Did you pick it up? if so you took possession in that state and need to remit there.

If they delivered out of state (and have no presense in your state) then they probably would not be liable for collection. (unless the 2 states have an agreement) but the onus is then on you to declare and remit to your home state.

My busness was in Montreal and we'd often ship boxes 'out of state, country' to buyers residence to help out the buyers. This is legitimate. The onus is on buyer to remit home taxes.
(They could claim rebates and re-pay their home taxes, but that was long and complicated. I naturally assumed they would promptly remit once thay got home. LOL)

In the case of a tractor the vendor would need to have a bill of lading on file to prove his 'non collection of state taxes' othewise he would be liable to remit.

I think Piloon is right on everything except: If the dealer delivers to another state he is considered selling in that state and is required to collect and remit the sales tax. If the item is delivered by a contractor (trucking co., UPS, etc) the dealer is not required to collect the tax. The purchaser would then be required to "self-report" and pay the appropriate use taxes.

 

[MBDiagMan]

In Texas there's no tax on tractors because they are for farm use.

I expect that the dealer also has a store in Virginia is why they collect the tax. I buy a good bit of stuff on the internet from out of state. If it is an organization with a store in Texas, they collect sales tax. SO, I obviously prefer companies with no store in Texas. Then the lack of tax makes up for the cost of shipping.

 

[logan97]

In Texas there's no tax on tractors because they are for farm use.

I expect that the dealer also has a store in Virginia is why they collect the tax. I buy a good bit of stuff on the internet from out of state. If it is an organization with a store in Texas, they collect sales tax. SO, I obviously prefer companies with no store in Texas. Then the lack of tax makes up for the cost of shipping.

no they do not have a store in Va . Also I did not purchase anything just an observation. In a front page Farm Bureau news letter that arrived today, warning any Farmers with Va Farm Use tags to be aware of ticketing in N.C. They were permitted since 1996 N.C. attorney General has determined that this is not proper or permissible under N.C. law.

 

[Diamondpilot]

Just a thought -- perhaps NC and VA have some sort of reciprocal agreement to collect sales taxes for interstate sales.


Steve

Thats how it is here in Indiana if we buy a car, boat, or piece of equipment at most bordering states. They see ya coming.

Chris