Retailer wants to charge sales tax for an out of state purchase

Rumpltzer

Diamond Member
Jun 7, 2003
4,815
33
91
California...

I've been looking to buy a gun for a couple of months now. I've tried out several guns at ranges and decided on what I want. I've looked in all the stores in my area, and they're selling my gun for $560 to $600. There are several large (out of state) Web retailers who sell the same gun for $450 + $20 shipping.

As in most (all?) states, though, they can't just go and send you a gun; they need to send it to a licensed dealer who'll hold the gun for ten days, run a background check, etc. In most states this will cost $20 to $30, but most dealers in my area want $50 to $100 ($20 goes to the state and the rest is for profit). I've found a $50 guy, but it seems that he also wants to charge me sales tax.

Understand that I'd be buying the gun from someone in another state, and I'd be paying that person in the other state. The local guy will be paid $50 for his costs and his service, but he's otherwise not part of the transaction at all. Below is part of an email that he sent me this morning. He does point out that he won't know how much I paid for the gun, but I imagine teh Web retailer will probably include an invoice... and I really interpret this situation as the guy collecting a little extra and trying to pass it off as California sales tax, and I'm not happy about it.

Thoughts, comments, suggestions?

As far as the sales tax goes, I?m not sure, I just heard about a few larger dealers that are apparently being sued by the state for tax evasion for not collecting sales tax on out of state purchases. For the time being I think it would be in my best interest to collect the tax until a definite procedure is identified. That being the case, I would have no idea how much you paid for your gun $100 or $1000; so in theory, I guess you would tell me how much you paid for the gun and the tax would be based upon that figure. In the mean time I?ll be checking with the state board of equalization and DOJ to try and get an answer.
 

BigJ

Lifer
Nov 18, 2001
21,330
1
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You would be responsible for paying a use tax to your state government. It has nothing to do with the middle-man.

Also, to elaborate. If you were to purchase something from an out-of-state seller and paid tax on it, and that tax was greater than or equal to your state tax, you wouldn't have to pay anything to the state. If it was less, you would have to pay a use tax = to the difference.
 

Rumpltzer

Diamond Member
Jun 7, 2003
4,815
33
91
BigJ: I had never heard of a use tax before. Thanks for the info.


jagec:
The type of research I'm interested in goes on at three or four places on the planet. I have options to work in Santa Barbara, Malibu, or Los Angeles. The California location is the result of an unfortunate oversight that I made while choosing a major in high school. Who would have known?

The gun is mostly for entertainment purposes, and it's something I want.
 

jagec

Lifer
Apr 30, 2004
24,442
6
81
Originally posted by: Rumpltzer
BigJ: I had never heard of a use tax before. Thanks for the info.


jagec:
The type of research I'm interested in goes on at three or four places on the planet. I have options to work in Santa Barbara, Malibu, or Los Angeles. The California location is the result of an unfortunate oversight that I made while choosing a major in high school. Who would have known?

The gun is mostly for entertainment purposes, and it's something I want.

I'm just giving you a hard time...I actually like Cali, though it DOES have an...interesting...legal stance on some stuff. Unfortunately, I doubt you'll find a good way to skip out on the tax..."use tax" is crap IMHO, but such is life:(

You do have to reconcile yourself with the difficulty and cost of gun ownership there...maybe you could get a rifle instead of a handgun? That makes things MUCH easier...heck, I was given a shotgun once, carted it through a couple states, and then sold it in Cali with no papers ever changing hands, IIRC.

BTW, what kind of research is it?
 

DrPizza

Administrator Elite Member Goat Whisperer
Mar 5, 2001
49,601
167
111
www.slatebrookfarm.com
I really doubt the guy in your state is going to try to keep the extra money... especially if he gives you a receipt that clearly shows you paid him $50, plus tax on the purchase price of the gun. Yes, you're supposed to pay the tax to your state.

Your options:
1. Travel out of state, purchase the gun, paying the other state's tax, return to your state
2. Have the gun shipped to you firearms dealer in your state who will collect your state's sales tax on the price of the gun, which you are supposed to pay to the state.

It sounds like your state actually figured out that these are the two options and that they could easily use the middleman to collect the tax, rather than rely on people to be honest and send it to them.
 

JulesMaximus

No Lifer
Jul 3, 2003
74,574
972
126
Originally posted by: Rumpltzer
California...

I've been looking to buy a gun for a couple of months now. I've tried out several guns at ranges and decided on what I want. I've looked in all the stores in my area, and they're selling my gun for $560 to $600. There are several large (out of state) Web retailers who sell the same gun for $450 + $20 shipping.

As in most (all?) states, though, they can't just go and send you a gun; they need to send it to a licensed dealer who'll hold the gun for ten days, run a background check, etc. In most states this will cost $20 to $30, but most dealers in my area want $50 to $100 ($20 goes to the state and the rest is for profit). I've found a $50 guy, but it seems that he also wants to charge me sales tax.

Understand that I'd be buying the gun from someone in another state, and I'd be paying that person in the other state. The local guy will be paid $50 for his costs and his service, but he's otherwise not part of the transaction at all. Below is part of an email that he sent me this morning. He does point out that he won't know how much I paid for the gun, but I imagine teh Web retailer will probably include an invoice... and I really interpret this situation as the guy collecting a little extra and trying to pass it off as California sales tax, and I'm not happy about it.

Thoughts, comments, suggestions?

As far as the sales tax goes, I?m not sure, I just heard about a few larger dealers that are apparently being sued by the state for tax evasion for not collecting sales tax on out of state purchases. For the time being I think it would be in my best interest to collect the tax until a definite procedure is identified. That being the case, I would have no idea how much you paid for your gun $100 or $1000; so in theory, I guess you would tell me how much you paid for the gun and the tax would be based upon that figure. In the mean time I?ll be checking with the state board of equalization and DOJ to try and get an answer.

Do you have a Turner's Outdoorman near you? Call them up. They usually know what the rules are in a case like that. As far as I know though you don't have to pay CA sales tax on it.
 

JulesMaximus

No Lifer
Jul 3, 2003
74,574
972
126
Originally posted by: jagec
Your first mistake was trying to buy a gun while living in California;)

I've bought plenty of guns in CA. Easier than some states that's for sure.
 

Rumpltzer

Diamond Member
Jun 7, 2003
4,815
33
91
It's not that I'm trying to skip out on the tax. It's that the guy's response in my OP seems a little arbitrary, and I don't understand him collecting California state sales tax on an out of state purchase. I think that BigJ's info on the use tax is the correct answer, but (as he points out) it has nothing to do with the California FFL holder.

DayLaPaul: Yes, I'm talking about a Glock 17 from either TopGlock or GlockWorld for $449 + $19 insured shipping. GlockWorld has a 5% discount for GlockTalk members. Now it's just a matter of getting the gun into California.
 

BigJ

Lifer
Nov 18, 2001
21,330
1
81
Rumpltzer,

Did some poking and found this FAQ:
http://www.ag.ca.gov/firearms/dlrfaqs.htm#39G

What fees can I charge for handling a Private Party Transfer (PPT)?

If the transaction is a PPT, you are restricted to charging no more than $25.00 in State fees described and $10.00 per firearm for conducting the PPT. For example:

a. For a PPT involving one or more handguns, the total allowable fees are $35.00 for the first handgun, and $31.00 for each subsequent handgun.
b. For PPTs involving one or more long guns, the State fees are limited to $25.00 for the whole transaction plus $10.00 dealer fee per firearm transferred.

(PC section 12082)

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Makes no mention of sales tax for PPT.
 
Feb 24, 2001
14,513
4
81
PPT isn't a sale from a retailer though is it?

What it amounts to is you are trying to buy something cheaper than a local guy is willing to sell it to you. He's going to add enough fees so that there won't be any savings.

Best bet is to find a local honest shop that will charge the customary $10-$20 to do the transfer.

The FFL shouldn't be collecting sales tax.
 
Aug 23, 2000
15,509
1
81
go to a damn gun show and buy there. By the time you pay for shipping, this scammers fees and supposed taxes, you can get the gun cheaper locally.
 

mugs

Lifer
Apr 29, 2003
48,920
46
91
This guy doesn't benefit from collecting sales tax, so I wouldn't assume he's trying to rip you off.
 

Rumpltzer

Diamond Member
Jun 7, 2003
4,815
33
91
BigJ: I've seen those "rules" before, and others have talked about them on other forums. The way I read that is that no one should be charging more than $35 total for a PPT... and yet, the least expensive in this area is $50 and most want something closer to $100. What can you do??

I was reading more about the use tax here and I think you were dead on in mentioning it.


JeffreyLebowski:
You're in Texas, right? :) I was reading on another forum as the members complained about how a local gun show (in California) had turned into a paintball convention. They blame the restrictive laws that we have here in California.


mugs:
If the guy collects sales tax on something that he sells me, then I have no problem with that. The thing is, I'm purchasing an item from someone else and he's acting as a local middle-man. He isn't selling me anything except his service as a middle-man. What is he collecting sales tax on??

Is this equivalent to buying something COD and the delivery service wanting to charge sales tax for the item they're delivering?