California Prop 56 - Hidden Vape Tax
- Thread starter Haktuspit
- Start date
- th_trl_thread_readers 0
- Status
I contacted TastyVapor regarding the Wholesale vs. Retail Tax basis.
I just received a reply and they said they are "taking down" the Tax until the understand it further.
I just received a reply and they said they are "taking down" the Tax until the understand it further.
Thank you Kat.
I really want to TastyVapor the benefit of the doubt. And I truly Hope this was just a Mis-Interpretation of the Law. But I would think that someone that has been around as Long as TV has would know what is Going On. They were one of the 1st people I ever bought an e-liquid from. Them and Johnson Creek.
That, and I'm a Big Letter writer. LOL.
It will be Interesting to see what Revised Tax Rate TV comes up with.
Yeah. And considering that Geoff and Ramilya have always been very active in pro-vaping movement, it's kinda strange that they wouldn't know. I remember that they went to Sacramento with Stefan Didiac, Greg Conley, James Root, etc. to protest and testify. How odd.
Remember that battle?
Oh, no, it's alive! CA no-shipping bill AB1500 assigned to committee
And TV is one of the founding members of SFATA.
SFATA | Electronic Cigarette Association, Member Logo's
Last edited:
Good for them. I have not received a response from Breazy and I wouldn't be surprised if they are just confused. They just need to fest up and respond.
Oh Yeah... I remember it Well.
Hopefully they well Respond to you Soon.
The Tax on the 0mg is what really Shocked me. Because there should be No Confusion over that. Period.
I've gotten responses just no answer yet.
I've talked to a few cig shop owners and have gotten quite a revelation. It seems the wholesalers aren't collecting the tax when they charge the shops but making the shops collect it and pay the state. All the cig shops I talked to say they increase the price before the sale and only charge the sales tax at the register.
Here's the caveat though. The tobacco tax is a dual tax increase. Not only is there the tax on the wholesale price, but the state also gets a sales tax amount increase. By taxing the wholesale price it increases the sale price and therefore the amount of sales tax you pay goes up.
For example. Say a pack of cigs is $5 wholesale and the tax on that is $2.70. The retailer then adds a mark up of $1. Total cost is now $8.70+sales tax. That sales tax is $.80 at the 9.25% in my town.
Now let's say the tobacco tax prior was 50 cents. So the final cost would then be $6.50+sales tax. That sales tax would then be $.60. In this example that's a 20 cent increase in sales tax collected.
The laws say we can't be charged taxes on a tax yet I see no one fighting this angle. I'm trying to get clarification from the BOE but getting no where fast.
This is Correct. Sales Tax can not be applied onto something like an Excise Tax.
And that is why you will sometimes see on an Itemized Recipe the term "Taxable Portion of Final Sale".
What many Companies do to make the Accounting simpler is just Tax it all. But when they Calculate their Quarterly Payments, they "Back Out" the Excise Tax from their Taxable Sales and then compute a New Collected Tax amount. And this is what they send in.
Not saying this is Right. Because the Consumer end up Paying Tax on Tax. But a Seller can set any Price for an Item. So a Seller will argue that the Consumer will pay the Same Amount. The Only Difference is on how the Before Tax price was shown.
Which is where the Class Action Lawyers usually enter from Stage Left.
The BOE is busy; preoccupied with trying to browbeat small businesses (like mine) in other states into handing over records of sales to Cali residents so they can come after y'all for Use Tax on your out-of-state purchases.
The BOE is busy; preoccupied with trying to browbeat small businesses (like mine) in other states into handing over records of sales to Cali residents so they can come after y'all for Use Tax on your out-of-state purchases.
Do you have to comply?
I hope you are refusing to comply. That's is immoral, probably unconstitutional on several levels and I would guess illegal. Not to mention states have no jurisdiction in interstate commerce.The BOE is busy; preoccupied with trying to browbeat small businesses (like mine) in other states into handing over records of sales to Cali residents so they can come after y'all for Use Tax on your out-of-state purchases.
Is taxing the tax illegal federally or just in CA? PA's 40% excise tax is taxed by the 6% use tax, 48% total. It's directly on the form for claiming out of state purchases.
Nope.
Do you have to comply?
This happened a few years ago, and just to be clear, my business has nothing to do with anything like vaping or tobacco. Anyway, the BOE started with letters "requesting" the data. I consistently round-filed them. The letters eventually got stronger, more along the lines of a demand. I kept round filing them. Then they started calling. I don't usually answer the phone myself and was never available to take their calls, but they kept trying. They finally got a hold of me when I had a bunch of people away at a trade show. They were quite indignant that I had been blowing them off. I told them, "Look, I have no nexus of any sort in California, and unless/until you produce a court order signed by a judge that actually has jurisdiction, meaning a PA or federal judge, you aren't getting anything from me". So they threatened to continue sending letters. "Whatever, but I'm going to keep putting them straight in the trash, where they belong."
I've not heard from them since.
Just an Update:
I just received a Nice e-Mail from TastyVapor. And they have revised the Taxable Amount in accordance with Prop. 56.
I just received a Nice e-Mail from TastyVapor. And they have revised the Taxable Amount in accordance with Prop. 56.
Here's the first reply I got from Tyler at Breazy.
I'll be sending a follow up and will add questions you guys have if you want me to.
You should ask Why they are applying a Tax on 0mg e-Liquids?
And you should ask why they are Taxing the Retail Price? And Not the Wholesale price?
The Link in the Post below explains things pretty clearly.
I did send another message this morning and received a response. I feel like someone told a customer service person to respond and the person really did not have a clue. "Due to the fact that we operate as a Distributor and Wholesaler, we must make sure we are charging the accurate amount of tax for each different transaction we make. This law is new and we are adapting to this as best as possible. I apologize for the inconvenience this imposes on California customers, unfortunately, we must comply with each individual state laws and regulations."
I found it interesting that he left out they are an online retailer since they do sell to end users and the BOE document addresses retailers as well. Quite honestly his response was very annoying to me as he did not answer my questions. While I would like to pursue this I don’t want to jeopardize other CA vapers that purchase from them as they could decide not to sell as an online retailer to CA residents. Not sure what I am going to do next. I may just send the BOE document so they can research answers to my questions.
I found it interesting that he left out they are an online retailer since they do sell to end users and the BOE document addresses retailers as well. Quite honestly his response was very annoying to me as he did not answer my questions. While I would like to pursue this I don’t want to jeopardize other CA vapers that purchase from them as they could decide not to sell as an online retailer to CA residents. Not sure what I am going to do next. I may just send the BOE document so they can research answers to my questions.
- Status
Similar threads
- Locked