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Sales Tax

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xSkyDrAx

xSkyDrAx

Diamond Member
I currently live in socal and anyone that does knows the sales taxes are crazy high around here. Fortunately I live about 45 minutes to 1 hour from OC where it's 1% less (7.75 vs 8.75).

If you're picking up a car would you make the drive out to save that 1% in sales taxes? This is given that you would get the exact same deal regardless of buying it at a closer dealer.
 
I think state sales tax is payable based on your residence, but I believe we're talking about difference in sales tax rate due to an additional municipal sales tax, I'm not sure how that works, my gut says you pay whatever the sales tax is at the dealership's location. The state makes you pay sales tax on the purchase of a car because it has to be registered through the state, they know when you've bought a car and want a piece of the action. I'm not sure how a city or county could collect sales tax for a vehicle sold outside the city or county, they have no way of knowing that the vehicle was purchased.
 
kornphlake said:
I think state sales tax is payable based on your residence, but I believe we're talking about difference in sales tax rate due to an additional municipal sales tax, I'm not sure how that works, my gut says you pay whatever the sales tax is at the dealership's location. The state makes you pay sales tax on the purchase of a car because it has to be registered through the state, they know when you've bought a car and want a piece of the action. I'm not sure how a city or county could collect sales tax for a vehicle sold outside the city or county, they have no way of knowing that the vehicle was purchased.
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Well I believe for CA the state minimum is 7.25% but depending on which city you're in it can range between 7.25% to 9.75%. I guess my question is if I'm buying in a city that has 7.75% sales tax do I pay that at the dealer or do I pay 8.75% based on my address?

Also there's no double taxing going on right? If that's even possible. I.E city tax + state tax because that makes no sense.

The scenario I was hoping for was just head over to near by city with less sales tax and buy it there. I know this is the case for retail shops because people are charged the sales tax of the city they're in even if they're not from around there. I would think that would have been the same situation for buying a car?

Used to work retail and loved the look on a persons face when they're from another city and they purchase something, look at the reciept, and say 'I thought this was $xx.xx!). I would reply that is correct that is the price. They would then go 'No, I did the math at home it came out to be blah and blah but it's more here' And I would point out the sales tax to them. Kinda sucks for them if it's not a huge difference and the distance of their drive eliminated any savings for them.
 
xSkyDrAx said:
I currently live in socal and anyone that does knows the sales taxes are crazy high around here. Fortunately I live about 45 minutes to 1 hour from OC where it's 1% less (7.75 vs 8.75).

If you're picking up a car would you make the drive out to save that 1% in sales taxes? This is given that you would get the exact same deal regardless of buying it at a closer dealer.
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Depends on how much the car costs I guess.
 
kornphlake said:
I think state sales tax is payable based on your residence, but I believe we're talking about difference in sales tax rate due to an additional municipal sales tax, I'm not sure how that works, my gut says you pay whatever the sales tax is at the dealership's location. The state makes you pay sales tax on the purchase of a car because it has to be registered through the state, they know when you've bought a car and want a piece of the action. I'm not sure how a city or county could collect sales tax for a vehicle sold outside the city or county, they have no way of knowing that the vehicle was purchased.
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Dealership collects the sales tax and pays it to the state. The consumer pays the dealer.

When you see businesses running a no sales tax sale they are just reducing the cost of their merchandise by the amount of the sales tax. They still pay the state for the transaction, they just don't collect the money. Car dealerships sometimes run these sales too.
 
Easy, just buy and register your car with a friend in Oregon. After a while, re-register in California.
 
JulesMaximus said:
Dealership collects the sales tax and pays it to the state. The consumer pays the dealer.

When you see businesses running a no sales tax sale they are just reducing the cost of their merchandise by the amount of the sales tax. They still pay the state for the transaction, they just don't collect the money. Car dealerships sometimes run these sales too.
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If the dealer is collecting the sales tax then wouldn't I be paying based on wherever the dealer is located? Unless the dealer is going to look at my address and charge me based on where I'm from.

I'm guessing you have some experience with this Jules as you're from Cali?
 
xSkyDrAx said:
If the dealer is collecting the sales tax then wouldn't I be paying based on wherever the dealer is located? Unless the dealer is going to look at my address and charge me based on where I'm from.

I'm guessing you have some experience with this Jules as you're from Cali?
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Californians pay car sales tax based on residency. When you fill out the paperwork at the dealership that registers the car ... it asks for home address.
 
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