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Updated!! Pennsylvania: 40% tax = game over for vape

Discussion in 'ECF Competitions and Broadcasts' started by Oliver, Jul 14, 2016.

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  1. pyro12

    pyro12 Senior Member ECF Veteran

    Mar 16, 2011
    Pittsburgh
    How would the state of PA know if someone in PA ordered vape supplies from another state and had them shipped to PA? This seems totally unenforceable to me.
     
  2. retired1

    retired1 Administrator Admin Verified Member ECF Veteran

    Supporting member
    Apr 5, 2013
    Texas
    Totally enforceable. Companies are required to charge the applicable tax rate for those states that require it. Technically, a company in Florida should be taxing the appropriate rate for Pennsylvania and forwarding those tax revenues to the state when they do their taxes. If a company doesn't do that, and they're caught keeping those proceeds when tax time rolls around, it's not going to be a pretty picture when the state/feds are finished with 'em.
     
    • Like Like x 1
  3. Smeef

    Smeef Senior Member Verified Member ECF Veteran

    Mar 30, 2015
    Williamsport, PA
    Not entirely correct. Companies outside of PA are NOT responsible for collecting the 40% tax. They can if they choose to, but they aren't required to. If a resident of PA orders vape supplies from a company in CA and that company is one that chose not to charge the 40% tax, it then falls on the responsibility of the purchaser. There are some companies that are charging the tax if you reside in PA, while some are not. It more or less comes down to which party involved in the transaction is going to submit it.
     
    • Like Like x 3
  4. retired1

    retired1 Administrator Admin Verified Member ECF Veteran

    Supporting member
    Apr 5, 2013
    Texas
    Depends on the state. Some states are somewhat lax in the requirement, others want you to do so.
     
  5. blueish

    blueish Full Member

    Jan 8, 2013
    us
    I think it should be the responsibility of the purchaser. The most frustrating part for me is that some companies will no longer even ship to PA. I have, and will pay the tax, but I can't even order from one of my favorite juice companies.
     
    • Like Like x 1
  6. pyro12

    pyro12 Senior Member ECF Veteran

    Mar 16, 2011
    Pittsburgh
    Sorry, I should have been more clear:

    If an individual within PA orders from a vendor outside of PA and has the product shipped to PA... How would the state of PA ever even find out? I can't imagine the vendor having any legal obligation to report their sales to PA.
     
    • Like Like x 1
  7. Smeef

    Smeef Senior Member Verified Member ECF Veteran

    Mar 30, 2015
    Williamsport, PA
    They can. They can ask any company for their sales records. Same way people get caught importing cigarettes.
     
    • Like Like x 2
  8. blueish

    blueish Full Member

    Jan 8, 2013
    us
    Not sure, but with the penalty system they have I'm not going to risk not reporting it myself. It's still cheaper than cigs and I don't have to worry about a nastygram from the Dept. of Revenue.
     
    • Like Like x 1
  9. zoiDman

    zoiDman My -0^10 = Nothing at All* ECF Veteran

    Supporting member
    Apr 16, 2010
    So-Cal
    I do Not Believe this is correct.

    If my Company has No Physical Presence in the State of PA, I don't believe I as a Retailer have any Responsibility to Collect Taxes for the State of PA.
     
    • Like Like x 5
  10. blueish

    blueish Full Member

    Jan 8, 2013
    us
    image.jpeg
     
    • Like Like x 1
  11. Rossum

    Rossum Surly Curmudgeon Verified Member ECF Veteran

    Supporting member
    Dec 14, 2013
    SE PA
    Based on the precedent set by the Supreme Court in Quill Corp. v. North Dakota, I disagree.
     
    • Like Like x 4
  12. Rossum

    Rossum Surly Curmudgeon Verified Member ECF Veteran

    Supporting member
    Dec 14, 2013
    SE PA
    Yeah, they can ask. That doesn't mean they'll get.

    Some years ago, I had the California Board of Equalization hounding my PA-based business (that has no nexus in California) for a list of my sales to California residents, presumably so they could go after those customers for Use Tax on the purchases they'd made from me. Long story short: I told the California Board of Equalization in no uncertain terms that they had no standing to demand anything at all from me and the only way they were getting any data from me is with an order from a court that actually had jurisdiction, i.e. a Federal or Pennsylvania court. That was the last I ever heard from them.

    Of course, there is the risk that a vendor you order stuff from won't be as hard-nosed as I am about these kinds of issues, and will hand over their records. In that case, you're screwed if you haven't paid the taxes to PA yourself.
     
    • Like Like x 7
  13. retired1

    retired1 Administrator Admin Verified Member ECF Veteran

    Supporting member
    Apr 5, 2013
    Texas
    Out-Of-State Retailer? Tread Carefully In Connecticut

    Pennsylvania Internet Sales Tax | Nolo.com

    States have been slowly chipping away at Quill for years. And there hasn't been another case before SCOTUS since then. In Pennsylvania's case, if the business is running an affiliate program, and there are affiliates in Pennsylvania, then the business is required to collect Pennsylvania taxes. It boils down to the use of the term "nexus" and how each state defines it.
     
    • Like Like x 2
  14. Seiggy

    Seiggy Full Member

    Feb 1, 2012
    Irwin, Pennsylvania
    Did some checking since nothing heard in awhile. Seems that the PA House has voted 19-4 to kill the tax totally. PA Senate to vote to kill the tax Jan. 23-27 (next week). If it gets past the Senate it goes to PA Gov. for autograph...I guess losing 70 out of 300 PA vape shops since Dec. end has hit a nerve... Fingers crossed. Checking was prompted by some online retailers not selling to PA residents and finding out that there are also Manufacture / Distributor / Retailer license fees involved. Not to mention who pays what in taxes and when.....
     
    • Like Like x 4
  15. Smeef

    Smeef Senior Member Verified Member ECF Veteran

    Mar 30, 2015
    Williamsport, PA
    Where did you get that info? From my understanding, the bill was never voted on let alone read during last years session, meaning it's dead. From the info I gathered it now has to be re-introduced next week.

    Sent from my SM-G920V using Tapatalk
     
    • Like Like x 3
  16. blueish

    blueish Full Member

    Jan 8, 2013
    us
    It was the finance committee that voted to repeal it. It still needed a house vote. Unfortunately, the full house never even considered it during the October session. I haven't heard any updates, so I would assume it's stalled for the foreseeable future.
     
    • Like Like x 3
  17. Smeef

    Smeef Senior Member Verified Member ECF Veteran

    Mar 30, 2015
    Williamsport, PA
    It wasn't "stalled" rather it's dead. There will be two new Bills introduced for when the session comes back on January 23rd. That is the info I've gathered from a PA Tax Facebook group. There is going to be a rally at the Capital as well on the 23rd.
     
    • Like Like x 5
  18. Seiggy

    Seiggy Full Member

    Feb 1, 2012
    Irwin, Pennsylvania
    You are all correct.... HB 2342 was 19-4 to repeal in full from House Finance and replace with a 5 cent per milliliter e-liquid tax instead. I think my late night reading got the best of me... Call it HOPE....Fingers still crossed.
     
    • Like Like x 4
  19. Whether dead or stalled, this is really good news and seems to be a step in the right direction. Fingers crossed right along with you, Seiggy.
     
    • Like Like x 3
  20. vape-o-matic

    vape-o-matic Senior Member Verified Member

    Jan 17, 2017
    fairfield, pa
    fingers crossed, and prayers said
     
    • Like Like x 4
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