Well sort of. There’s a law that acts just like one.

Bob Grossman of St. Paul picked up his home phone, dialed Sears at the Mall of America in Bloomington and bought a dishwasher, which he had delivered to his home. When he got the bill, he was irritated to find he was charged 7 percent tax (St. Paul’s rate) rather than 6.5 percent (Bloomington’s rate).

I knew that if you bought something in the higher taxed areas, that you had to pay that areas tax. But having to pay your area’s higher tax rate for something bought over the internet? That sucks! My new boat engine I bought was “sales tax free”, but I may have to correct that?

Well, fair or not, it’s the law, convoluted as that might be: The amount of tax you pay can differ according to where you buy the item, where you use it and whether you buy over the Internet. For example, if Grossman had gone down to Sears with a pickup truck and taken the dishwasher home, he would have been charged 6.5 percent tax.

It seems that someone has finally figured out how to tax the internet. Not only that, but it goes beyond the internet in some cases.

But — and this is something few consumers know — because he would be using the dishwasher in St. Paul, he could have been responsible for sending in a check for the additional half-percent to the state revenue department. If he bought it and delivered it himself to someone who lives in Bloomington, though, he wouldn’t have to pay extra, even though he’s from St. Paul.

Gee, the government found a way to charge people more tax. Go figure.

This is confusing and not well known. So, some examples:

• You’re a St. Paulite and you buy a diamond ring in Minneapolis. You don’t owe anything extra, because Minneapolis has the same 7 percent tax.

• You’re a Minnesotan and you buy a baseball bat in Wisconsin. It’s taxable in both states, but only at a 5.5 percent rate in Wisconsin. So when you get home, you owe the state of Minnesota another 1 percent — the gap between Minnesota’s tax and Wisconsin’s.

• You go to Dublin, Ireland, on vacation and come home with a set of Waterford glasses. You owe state (and city, if applicable) use tax, even though you made your purchase in another country.

• You’re from Wisconsin (where clothing is taxed) and you cross the border to Christmas shop in Minnesota (which doesn’t tax clothing). You buy “I Love Bulldogs” sweatshirts for everybody on your list and pay no sales tax. But when you get home, you owe Wisconsin 5.5 percent of the total on your receipt.

• You are a Minnesotan, you buy those sweatshirts in Wisconsin and you pay the tax. You don’t get any kind of a rebate, even though you would not have had to pay that tax back home.

• You buy computer equipment online, and the seller didn’t add your state sales tax to the bill. You still owe it.

This goes above and beyond the internet. This smacks of “big Government” to me! So we now owe Minnesota a share of everything we buy, no matter where we buy it. If we do take advantage of an area/state’s/county’s lower taxes, Minnesota has to make sure they get their fair share.

This one is worth digging into more. Does anyone else know about this?

This entry was posted on Monday, August 22nd, 2005 at 6:07 am and is filed under Minnesota, Politics. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.