What we call items and services, how we characterize them, and how we bundle them on invoices really matters from a sales tax standpoint. Take for example
the “gentlemen’s club” in New York City that got hit with a $3 million tax bill over the scrip it encourages customers to use to pay and tip the club’s
entertainers, as reported in the Accounting Today.
Different states have their own ways of generating income. In 2016, Turbotax identified some of the oddest taxes. Blueberries in Maine and “flourless” candy in Illinois were being taxed. Tethered balloon rides in Kansas and “cut” bagels (only) in New York got similar treatment.
Where you purchased fruit from-- a grocery store or a vending machine – made a difference in California. Decorating your body with tattoos, body piercings and electrolysis in Arkansas cost you more in taxes. And that cowboy belt buckle in Texas came at a higher price that an ordinary belt buckle. In Colorado, your take-out coffee cost more as well when you put a lid on it.
Instead of passing on that receipt at checkout (or in the VIP room), take a closer look at what is being taxed and what is exempt. Let us know what “odd” taxes you are seeing.
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