John, my main company has been audited several times by revenue departments from the surrounding states, it is probably more common than you might think if you do business in more than one tax jursidiction. My business deals with sales only to other businesses, and we do so in many different taxing areas, I think we've probably been audited by at least one of the jurisdictions every year. Many states have tax reciprocity, many do not. All but a few states have sales tax and use tax. A sales tax is levied on a business or individual that buys goods that are not intended for resale. A use tax is levied on a business or individual when the good is purchased from out of state and is applied to all purchases that would normally qualify for sales tax. States that do not have sales tax typically don't have use tax. Some states actually go so far as to charge a differential use/sales tax whereby if your state's tax rate is HIGHER than the tax rate where you purchased a good AND where you paid THAT state's tax rate, then your home state actually charges you the difference between the lower tax rate and your home state's tax rate. It is the obligation of the taxpayer to pay the tax, failure to do so can result in some rather unpleasant consequences if you get caught. Not everyone gets caught. But I'd prefer not to have to deal with the wrong side of any revenue department, especially if I was in clear violation of the tax code.
All that said, SOME states have agricultural equipment sales tax exemptions that exempt things like tractors if they are used in some very specific ways that vary by state.
DISCLAIMER: I often testify before various state and county legislative bodies on the effects of excise taxes and how they can impact state budgets, hurt businesses and even increase criminal activity via bootlegging of goods. I typcially am called to testify by various state or regional retail associations on behalf of small business, however I have been invited to testify by State Senators and Legislators on multiple occasions.
