Talk:Use tax

Legality

Can someone please add some more information on how this tax could be legal. It is in direct violation of Constitution, Article I, Section 9, Clause 5. "No Tax or Duty shall be laid on Articles exported from any State." This request for improvements in the article by 74.64.90.198 (at 05:09, 20 December 2008) was moved to the talk page by 192.118.27.253 (talk) 05:43, 30 December 2008 (UTC)

Clause 5 is the reason why the State of Maryland (which has a 6 percent tax rate) cannot require a merchant in Delaware (no sales tax) to charge Maryland tax for merchandise sold to a customer in Maryland. This clause protects the mail order industry (both snail mail and internet) from the impossible burden of enforcing the sales tax laws of every state in the country.

The use tax is how states work around Clause 5 by assigning responsibility for the tax to the buyer rather than the seller. That makes it a tax on an imported article, not an exported article. It seems kind of sneaky, but is actually quite necessary to protect merchants within a state from untaxed goods shipped into the state by merchants who don't have to charge tax. Folklore1 (talk) 16:42, 7 January 2010 (UTC)

Actually, use taxes aren't intended to protect the merchants of the state so much as the state's own revenue stream. West's Encyclopedia of American Law states: A use tax may be imposed to prevent someone from evading a sales tax by buying goods in a nontaxing state and shipping them into the state that imposes the sales tax. If the state really cared about its merchants it would eliminate the sales tax. Pwhanson (talk) 09:59, 8 December 2010 (UTC)

The real problem is found in Art. I, Sec. 10, P. 2, and it looks like a Doozie to me!

Article I, Section 9, paragraph 5. could be (and I think is) a restriction on the power of the US Congress. But Article I, Section 10, paragraph 2 is explicitly addressed to the states and only allows them to impose taxes on imports or exports under four restrictive conditions. First, they need permission from the US Congress. Second, the purpose for the tax can only be to execute (finance) inspection (of imports and/or exports) mandated by state law. Third, any revenue generated by the taxes on imports or exports in excess of what is needed to finance the inspection belongs to the US Treasury. Fourth, the US Congress has power to revise and control such (inspection) laws. Now if it is conceded that Use Taxes are just import duties by another name, then we have a clear violation of the US Constitution by at least 22 states. And it seems that if the justice department were directed to do so, they could go after every penny of use tax ever collected and claim it for the US Treasury!

Pwhanson (talk) 08:16, 8 December 2010 (UTC)

History

I think the history of use tax would be a helpful addition. I've attempted to search for information on how the use tax came about, but haven't found much of anything. How did it originate? Which state was the first to implement it? Which states followed? What does the timeline look like? Where does Quill vs North Dakota fit in? How has this and other legal cases affected tax law? Etc. 208.107.27.200 (talk) 07:29, 11 May 2013 (UTC)

None, with exceptions

How is "With few exceptions, no state's vendors will charge the native state's sales tax on goods shipped out of state" different from "Few states' vendors will charge the native state's sales tax on goods shipped out of state"? 172.56.11.28 (talk) 03:18, 10 May 2015 (UTC)

Supreme Court

Colorado attempted to require (Amazon.com I think) to provide information on sales to Colorado. This was ruled unconstitutional by the US Supreme Court (the grounds were it was a regulation of interstate commerce which was prohibited to the states by the Constitution). I think this should be added, but I don't have the information to put it in myself. — Preceding unsigned comment added by 98.20.146.242 (talk) 17:03, 11 June 2017 (UTC)

I find a similar case in 2016, but this was a different ruling and was older than this. — Preceding unsigned comment added by 98.20.146.242 (talk) 17:07, 11 June 2017 (UTC)

Some clarity needed in article

The lead does a poor job of properly explaining what the use tax is. It says " It is essentially the same as a sales tax but is applied not where a product or service was sold but where a merchant bought a product or service and then converted it for its own use, without having paid tax when it was initially purchased." I bolded the word Merchant and "It's own use" becuase I believe they do not properly explain who in all is supposed to use taxes. Based on what I have read, use taxes (where they are collected) apply to all consumers (not just merchants) who purchases tax-free goods from out of states (such as via mail-order or online shopping) and they are supposed to pay it when they file their state taxes (for residents of states that have a use tax). It is not just a tax that merchants pay (or at least are supposed too pay in uss tax states.) but one any tax payer might need to pay. This Also, something else missing from the article is that few people actually pay the use tax and few states have cracked down on people not paying this tax when they should. Rather, their has been an effort to enforce out of state merchants to charge sales taxes for merchants of state of merchants location, based on the tax rate of the residency of the purchaser. So basically, we need to clarify the definition of a use tax and add something on the current low compliance rate in many if not most or all states that have a use tax. --2600:1700:56A0:4680:5831:22C9:2567:6140 (talk) 02:56, 18 August 2018 (UTC)