I'm wondering if the stores you guys frequent charge any tax when you buy singles or if they just sell them for the listed price? Up until now the two main stores I go too have always charged tax. Tax here is 15%. The other day though I went to another store in town that I've never been to, just to check out what they have. It turned out they have a pretty good selection and I got some singles totaling $12. When I went to pay, all they asked for was $12, no tax! I think I will be going here from now on. Their base price is cheaper than the other stores anyway and they have what I call the 15% discount. Do you think stores should be charging tax on their singles, or should they just sell for what the price is? Personally I think stores that charge taxes on the singles are really just hurting their customers.
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15% does seem like a pretty high tax rate. Still, it's the law. Either the store not charging tax is breaking the law (most likely) or paying the sales tax themselves. If it's the former, then that hardly seems like a place I'd want to patronize, personally.
One store I frequented charged tax if you were paying by credit card but not if you were paying in cash. At least, sometimes. It wasn't really consistent and was pretty much up to the register manager if they charged tax on cash single purchases.
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They should be charging tax, either after the purchase or by rolling it into the price. If they are charging tax on credit card purchases and not on cash purchases, either they are rewarding you for paying cash so that they don't have to pay the credit card fee and are rolling it into the price, or they are underreporting their earnings and don't be surprised if you walk up to your store one day and it's suddenly closed cause they got audited and slapped with massive fines.
I guess I never really paid attention. I know if you buy singles from our display case they are cash only, no additional tax. But when I buy cheaper stuff out of the binders I never noticed.
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I will always firmly stand by the belief that Magic is a game first and a collectable second.
I don't believe merchants (here in Canada) are technically required to charge sales tax on singles because each of those singles originally came from booster packs for which sales taxes were already paid. That being said, taxing an already taxed item feels like nothing more than a pure cash grab and a form of double-dipping. Think about it... If you go into your LGS today and sell a stack of cards to that store, they're not paying you sales tax on that inventory nor are they declaring those purchases as business expenses (which would essentially make said purchases tax-deductable for them), so why should you or any other customer have to pay them sales tax when they sell those same cards back to you? Any way you slice it it's a dual-standard, not to mention the fact that they're already making way more than enough profit on those singles since they're usually only buying them at 25-40% of their market value at best to begin with.
Anyhow, the best I can come up with myself is a game in the top 8 of a PTQ back during Urza block in which we were starting game 3 with time already expired, so the tiebreaker rule was that whoever had more life after 3 turns would win. And I lost to... healing salve.
What about boosters that the store opened specifically for the purpose of selling singles, those would not have had any sales tax paid on them. It would probably get pretty sketchy trying to keep them all separate, too. The fact of the matter is that charging you tax on your purchases is not a choice on the part of the seller. They do not make money off that tax in any way. If a particular store decides to roll that cost into the sticker price of singles, that is totally their choice, but in essence is just them choosing to charge you a lower base price. The fact that it makes you feel better about them is good marketing, but has nothing to do with ethics.
I'm wondering if the stores you guys frequent charge any tax when you buy singles or if they just sell them for the listed price? Up until now the two main stores I go too have always charged tax. Tax here is 15%. The other day though I went to another store in town that I've never been to, just to check out what they have. It turned out they have a pretty good selection and I got some singles totaling $12. When I went to pay, all they asked for was $12, no tax! I think I will be going here from now on. Their base price is cheaper than the other stores anyway and they have what I call the 15% discount. Do you think stores should be charging tax on their singles, or should they just sell for what the price is? Personally I think stores that charge taxes on the singles are really just hurting their customers.
that other store actually was charging tax. They're required to by law. They were just pricing their singles such that they would come to their value after tax.
That being said, taxing an already taxed item feels like nothing more than a pure cash grab and a form of double-dipping.
I've met my share of LGS owners who do some downright strange things because they fundamentally don't understand how business actually works. They just figure they like games and want to open a game store, but don't have any real education or experience in the matter. Not knowing whether singles are taxable or not (and thus charging tax for no reason other than "to be safe") is actually fairly benign compared to some of the ignorance I've seen.
It depends from state to state, county to county and I would assume country to country, but I have been told tax is paid on the product when its bought in sealed form. If I buy a pack from a store, I pay tax. If I take one of those cards and trade/sell it to the LGS, no tax is added on because I already paid tax on the item. Same for when that store sells single. At least thats how it was explained to me in my area.
It depends from state to state, county to county and I would assume country to country, but I have been told tax is paid on the product when its bought in sealed form. If I buy a pack from a store, I pay tax. If I take one of those cards and trade/sell it to the LGS, no tax is added on because I already paid tax on the item. Same for when that store sells single. At least thats how it was explained to me in my area.
This is exactly how it worked for me in both Saint Louis and Salt Lake City.
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The requirement for paying sales tax falls on the seller. Most choose to pass the tax to the consumer by adding the tax to the item price. A few stores price items with tax calculated in the price. A store who charges tax when using a credit card (paper trail) and no tax for cash (no paper trail) is probably doing something illegal.
When an individual person sells an item they are supposed to claim the sale as a capital gain/loss, businesses claim sales tax. Enforcement is infeasible for many of these cash transactions; it doesn't really matter (until we have government approved digital only currency).
Some "used" items can be exempt from sales tax on resale. I don't know where Magic cards fall legally. AFAIK pawn shops are subject to sales tax except on specific items.
It really does depend on the state's laws. I can only speak for my state. Tax should be billed by retailers. There is a mechanism whereby businesses can back into the tax base. Essentially, they're discounting the item and billing you the tax but not necessarily telling you. It's a bit of a grey area and depends on some other facts and circumstances. Generally businesses buy their product tax free from their vendors because they'll be reselling it. If the sealed product purchased gets cracked for singles, sales tax would be due at the time of sale. Same if they acquire singles from out in the world. The fact those singles may have been taxed when they were originally in boosters is irrelevant. As long as the business is engaged in retail sales (as oppose to a random person) they should be collecting tax. I can understand the frustration at the double dipping but the point is that the economic transaction is what's looked to. That single was only taxed at the value of the booster but could be worth significantly more as a single. Obviously the state is looking to tax that increased value.
This stuff can get surprisingly nitty-gritty and the only people that really understand it fully are the people that get paid to.
It isn't a % tax... but they are all more expensive than even SCG. manamorphose was like $3 last time I tried to buy things from them (back before DRS ban)
The other store sets rare prices to above whatever they were at the time they bought so you can have the same rare at different prices, their prices get much better the more expensive the card is so I guess that is closer to a % tax. I mean I got Abrupt decay for $7 a year ago. Also all commons are in a box and you just have to go through it. But I found Artifact lands bought them for 10c at one store and sold them to the other store for $1.
When I was younger, I frequented a store that never charged tax on singles. At some point I went to a store that did charge tax and was blown away, because I had become so use to the idea that I thought it was common place. Needless to say, I spent my money at the place that didn't charge tax on singles.
More recently, I still know of a store or two that don't charge tax on singles, but more do then don't. One shop will not charge tax on trades. So if you trade in $5 worth of cards and buy some new cards with that money, they don't tax you. I would suspect that this is probably rather common.
The requirement for paying sales tax falls on the seller. Most choose to pass the tax to the consumer by adding the tax to the item price. A few stores price items with tax calculated in the price. A store who charges tax when using a credit card (paper trail) and no tax for cash (no paper trail) is probably doing something illegal.
Or maybe it's just because they have to pay the credit card company for the transaction. So they don't want to pay the credit card company AND sales tax out of their own pocket.
The requirement for paying sales tax falls on the seller.
This is not quite true, at least not in all locations. I live in Maine where I am required each year to enter a zero on a line on my tax return stating that I have purchased no items out of state that were subject to Maine sales tax but were no tax was collected. I'm not sure exactly how it is worded. But, if I go to (tax free) NH to buy a car and return to Maine to register it, I must pay sales tax to the State of Maine. Same is supposed to happen if I go to NH to buy a big screen TV, but I am willing to wager very few people make an accurate claim of such items on their income tax return.
In Maine, as a reseller, I don't have to pay tax on items that I purchase for resale, but I must collect a tax on items I sell. The fact that the item I am purchasing for sale is used is of no importance. For instance, if I go to an auction and buy an item, I can present my reseller certificate and not pay tax on the item purchased at auction, but I must collect tax (and report it) when I resell the item.
Applied to a game shop, they should not pay tax when they purchase singles for resale. But, they should collect tax on singles they sell. It makes no difference whether a kid paid tax when he purchased the pack at the same store where he is trading the card in.
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When I was younger, I frequented a store that never charged tax on singles. At some point I went to a store that did charge tax and was blown away, because I had become so use to the idea that I thought it was common place. Needless to say, I spent my money at the place that didn't charge tax on singles.
More recently, I still know of a store or two that don't charge tax on singles, but more do then don't. One shop will not charge tax on trades. So if you trade in $5 worth of cards and buy some new cards with that money, they don't tax you. I would suspect that this is probably rather common.
The requirement for paying sales tax falls on the seller. Most choose to pass the tax to the consumer by adding the tax to the item price. A few stores price items with tax calculated in the price. A store who charges tax when using a credit card (paper trail) and no tax for cash (no paper trail) is probably doing something illegal.
Or maybe it's just because they have to pay the credit card company for the transaction. So they don't want to pay the credit card company AND sales tax out of their own pocket.
It could be that, or it could be that the point of sale they use adds the tax on, but when you pay cash it either doesn't get rung in that way (or at all like at a booth).
I know that in FL its called sales and use tax, so we pay tax on the product either way. (I'd pay tax on it theoretically if I opened it up and make menger sponges out of the whole case. )If you do charge tax you are required by law to remit it to the state. For instance if you charge your county tax when you are doing business in another county. You collected it, so you owe it to the state.
The guys who are charging list price are eating the tax in most cases because they have to to compete with online stores who don't have to collect it.
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One of the stores I go to charges tax when you pay in cash, but not when you're trading in cards. For example; if I trade in a Damnation and get 30$ credit for it, I can get that Aether Vial for $20 with no tax included(as well as a $10 card or if I want to keep it, I can).
One of the stores I go to charges tax when you pay in cash, but not when you're trading in cards. For example; if I trade in a Damnation and get 30$ credit for it, I can get that Aether Vial for $20 with no tax included(as well as a $10 card or if I want to keep it, I can).
This is what one of the stores near me does as well. When you pay in cash/credit, you have to pay tax, because it's a transaction that involves a monetary exchange. If it's a trade that doesn't involve any money (or involves the store paying me if I trade in more value than I get back), then the store doesn't charge tax, because the only thing that the store is acquiring is goods, not money.
The other LGS that I frequent does charge sales tax, but actively calculates what the tax will be for non-singles and then subtracts it from the listed price, such that if you're buying, say, a $12 booster, it'll be on display as $11.29. It's kinda weird, but in a way, I appreciate that the owner takes the extra step.
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I will always firmly stand by the belief that Magic is a game first and a collectable second.
that other store actually was charging tax. They're required to by law. They were just pricing their singles such that they would come to their value after tax.
I've met my share of LGS owners who do some downright strange things because they fundamentally don't understand how business actually works. They just figure they like games and want to open a game store, but don't have any real education or experience in the matter. Not knowing whether singles are taxable or not (and thus charging tax for no reason other than "to be safe") is actually fairly benign compared to some of the ignorance I've seen.
It depends from state to state, county to county and I would assume country to country, but I have been told tax is paid on the product when its bought in sealed form. If I buy a pack from a store, I pay tax. If I take one of those cards and trade/sell it to the LGS, no tax is added on because I already paid tax on the item. Same for when that store sells single. At least thats how it was explained to me in my area.
This is exactly how it worked for me in both Saint Louis and Salt Lake City.
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When an individual person sells an item they are supposed to claim the sale as a capital gain/loss, businesses claim sales tax. Enforcement is infeasible for many of these cash transactions; it doesn't really matter (until we have government approved digital only currency).
Some "used" items can be exempt from sales tax on resale. I don't know where Magic cards fall legally. AFAIK pawn shops are subject to sales tax except on specific items.
This stuff can get surprisingly nitty-gritty and the only people that really understand it fully are the people that get paid to.
The other store sets rare prices to above whatever they were at the time they bought so you can have the same rare at different prices, their prices get much better the more expensive the card is so I guess that is closer to a % tax. I mean I got Abrupt decay for $7 a year ago. Also all commons are in a box and you just have to go through it. But I found Artifact lands bought them for 10c at one store and sold them to the other store for $1.
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More recently, I still know of a store or two that don't charge tax on singles, but more do then don't. One shop will not charge tax on trades. So if you trade in $5 worth of cards and buy some new cards with that money, they don't tax you. I would suspect that this is probably rather common.
Or maybe it's just because they have to pay the credit card company for the transaction. So they don't want to pay the credit card company AND sales tax out of their own pocket.
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This is not quite true, at least not in all locations. I live in Maine where I am required each year to enter a zero on a line on my tax return stating that I have purchased no items out of state that were subject to Maine sales tax but were no tax was collected. I'm not sure exactly how it is worded. But, if I go to (tax free) NH to buy a car and return to Maine to register it, I must pay sales tax to the State of Maine. Same is supposed to happen if I go to NH to buy a big screen TV, but I am willing to wager very few people make an accurate claim of such items on their income tax return.
In Maine, as a reseller, I don't have to pay tax on items that I purchase for resale, but I must collect a tax on items I sell. The fact that the item I am purchasing for sale is used is of no importance. For instance, if I go to an auction and buy an item, I can present my reseller certificate and not pay tax on the item purchased at auction, but I must collect tax (and report it) when I resell the item.
Applied to a game shop, they should not pay tax when they purchase singles for resale. But, they should collect tax on singles they sell. It makes no difference whether a kid paid tax when he purchased the pack at the same store where he is trading the card in.
It could be that, or it could be that the point of sale they use adds the tax on, but when you pay cash it either doesn't get rung in that way (or at all like at a booth).
I know that in FL its called sales and use tax, so we pay tax on the product either way. (I'd pay tax on it theoretically if I opened it up and make menger sponges out of the whole case. )If you do charge tax you are required by law to remit it to the state. For instance if you charge your county tax when you are doing business in another county. You collected it, so you owe it to the state.
The guys who are charging list price are eating the tax in most cases because they have to to compete with online stores who don't have to collect it.
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The other LGS that I frequent does charge sales tax, but actively calculates what the tax will be for non-singles and then subtracts it from the listed price, such that if you're buying, say, a $12 booster, it'll be on display as $11.29. It's kinda weird, but in a way, I appreciate that the owner takes the extra step.
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