I was at a local B&M yesterday that i didnt no that was there. I was BS with the owner and he ask me were i been getting my cigar from. I told him i just started to order on line a few month ago. HE said to be careful that a few of the local customer been hit with paying taxes on the all the cigars and tobacco they been buying online. Said something about going after ppl buy online for not paying the taxes. Any one here anything about this? Should i be concerned about ordering on line? i live in new jersey last thing i want is pay taxes on all the cigars i been ordering online!!!!
cigar tax?
- Thread starter joey469
- Start date
Are you perhaps referring to sales tax and not taxes specifically on cigars?
Because for online purchases, the rule of thumb is that if you and the retailer both are physically located in the same state, you have to pay that state's sale tax.
It gets a bit murkier when you have third parties act as intermediaries but generally if the retailer doesn't have a physical presence in the same state as yourself, there's no sales tax.
Of course as with all things legal, this is probably subject to change. I know there are A LOT of retailers lobbying Congress to level the playing field as it were so all online purchases have to pay sales tax as well. I'm not sure what the status of that lobbying effort is at this time.
If you're however talking about tabacco specific taxes, I think that only applies to in state purchases--I know the state of Washington has some of the worst taxes on tabacco products (I think 75% of the wholesale price with a cap of $0.50 per cigar).
Because for online purchases, the rule of thumb is that if you and the retailer both are physically located in the same state, you have to pay that state's sale tax.
It gets a bit murkier when you have third parties act as intermediaries but generally if the retailer doesn't have a physical presence in the same state as yourself, there's no sales tax.
Of course as with all things legal, this is probably subject to change. I know there are A LOT of retailers lobbying Congress to level the playing field as it were so all online purchases have to pay sales tax as well. I'm not sure what the status of that lobbying effort is at this time.
If you're however talking about tabacco specific taxes, I think that only applies to in state purchases--I know the state of Washington has some of the worst taxes on tabacco products (I think 75% of the wholesale price with a cap of $0.50 per cigar).
SUOrangeGuy
Alpha Silverback
Some states have "sale and use tax." If they get proof on an online sale they can legally charge you the taxes on said items.
rrplasencia
monica lewinsky
i've been ordering online for years and have never had aproblem with paying taxes. i onl get taxed by cigarsdirect, corona, and tampasweathearts.
chippewastud79
Wow, Bengals Suck!
In theory, you are supposed to report goods and in-turn pay the taxes that are bought outside the state when you return them to the state in which you live.
Which means, in theory, if you lived in Michigan and ordered cigars online, when you brought them into the state you should have to call the state and let them know about your purchase of tobacco products and thusly pay your 32% Tobacco Tax. I know this is after-the-fact and therefor rarely done, but as in this thread, it sounds like states might be trying to recoup some of their lost Tobacco Taxes.
Luckily I live in Kentucky, where the Tobacco Tax = 0.00%
It is a law, but oftly ignored. Kind of like you are supposed to report any and all income on your taxes, but I have never seen anyone who claimed the change they found on the ground or the $10 they won on a scratch-off lotto ticket etc.
Which means, in theory, if you lived in Michigan and ordered cigars online, when you brought them into the state you should have to call the state and let them know about your purchase of tobacco products and thusly pay your 32% Tobacco Tax. I know this is after-the-fact and therefor rarely done, but as in this thread, it sounds like states might be trying to recoup some of their lost Tobacco Taxes.
Luckily I live in Kentucky, where the Tobacco Tax = 0.00%
It is a law, but oftly ignored. Kind of like you are supposed to report any and all income on your taxes, but I have never seen anyone who claimed the change they found on the ground or the $10 they won on a scratch-off lotto ticket etc.
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Mr Flibble
Uncle Arnie
This year is the first time I noticed a question about online purchases on my 1040A.
Freight Train
Dark Knight
You gotta love the government. America was not meant to be lke this. Our founding fathers would roll over in their graves if they knew how much this country has changed since they blead for their FREEDOM.
chippewastud79
Wow, Bengals Suck!
Just to be clear, these are the individual state governments, not the federal government :tu
Freight Train
Dark Knight
I understand what you are saying but government is government. These local businesses will have to report earnings to the national government also.:tu
Namerifrats
ChestBeater
State or Federal, all crooks. If they want me to pay tax on anything I bought online, they gotta catch me to steal my money. I'm not voluntarily handing over a cent. They steal enough out of my pay checks every two weeks.
Freight Train
Dark Knight
:tpd:
I personally will never report my cigar purchases online since I don't agree with the unfair tax rate (40% of wholesale I believe) that they charge in Colorado. Just because most of the people think I should be taxed at that rate doesn't make it right... it is absolutely unfair and goes way beyond their reach IMO.
I would love to see a 40% tax on cars or alcohol and see how long that lasts. The people would be outraged... and if they insist on pursuing the issue... Then I will road trip to a more friendly state to make my purchases and do it in bulk.
I mean I already pay income tax, sales tax, property tax, alcohol tax, tax on my food, registration tax on my cars, etc... why the hell should I pay 40% more on cigars just because? I would be happy to pay sales tax but I refuse to pay the 40%... I support the local B&Ms as much as I can, but I can't afford to buy boxes in Colorado and pay an extra few bucks per cigar just so the state can get its jollies off me....
I would love to see a 40% tax on cars or alcohol and see how long that lasts. The people would be outraged... and if they insist on pursuing the issue... Then I will road trip to a more friendly state to make my purchases and do it in bulk.
I mean I already pay income tax, sales tax, property tax, alcohol tax, tax on my food, registration tax on my cars, etc... why the hell should I pay 40% more on cigars just because? I would be happy to pay sales tax but I refuse to pay the 40%... I support the local B&Ms as much as I can, but I can't afford to buy boxes in Colorado and pay an extra few bucks per cigar just so the state can get its jollies off me....
rrplasencia
monica lewinsky
:tpd:
:r When you add it all up about 50% goes to taxes overall.
Then you die and they get the other half. :r
:r:bn That is so true... people like to say we have one of the lowest tax rates in the world... I say if we just paid income tax, then yes. But by the time you add it all up it is damn close to 50% and hell I don't even get free healthcare, or any of the other perks some countries get... we just blow it all on stupid projects anyway...
I love the way you worded it....made me LMAO...
In theory, you are supposed to report goods and in-turn pay the taxes that are bought outside the state when you return them to the state in which you live.
Which means, in theory, if you lived in Michigan and ordered cigars online, when you brought them into the state you should have to call the state and let them know about your purchase of tobacco products and thusly pay your 32% Tobacco Tax. I know this is after-the-fact and therefor rarely done, but as in this thread, it sounds like states might be trying to recoup some of their lost Tobacco Taxes.
Luckily I live in Kentucky, where the Tobacco Tax = 0.00%
It is a law, but oftly ignored. Kind of like you are supposed to report any and all income on your taxes, but I have never seen anyone who claimed the change they found on the ground or the $10 they won on a scratch-off lotto ticket etc.
This is the same thing I was told by the Cigar Fox Outlet store here in Metro Detroit; If I order online from Cigar Fox, they will add the 32% Michigan Cigar tax and the shipping - I'm further ahead buying from the outlet since I get charged the same taxes but save on shipping.
One of the guys I work with was buying his cigarettes online from some indian reservation for quite a while. Suddenly, he received a letter from the State Bureau of Treasury that said he owed the State of Michigan a .75/pack tax on all of his purchases. It seems Governor Jenny Grandstand had strong-armed a bunch of online vendors into giving up their customer lists and purchase information. The letter also said that he had violated some Michigan State Law and if it happened again, he would be prosecuted and be subject to fines along with the taxes. Needless to say, he doesn't buy online anymore! :hn
The incident to my co-worker happened a couple of years back, and I think the state only went after cigarette smokers. I should be asking each online vendor on how they plan on treating my purchases. I know that Cigar Fox will collect the taxes, because their corporate offices are here in Michigan. I have no idea how CI, Neptune, Famous, Fincks, Mike's and all the others are going to treat my personal information. :2 :2