Tenn. Tax Applied for Out Of State Repair Service

[trailspike48]

I just had a pipe repaiared by a shop recommended here on the forum, especially known for quick repairs. I was suprised to notice Tn. sales tax added to the final amount. I called the shop, and found out, an accountant had made the recommendation that out of state individual customers be charged the state tax.
I'm not sure if this policy is correct, I didn't raise a big fuss. I understatnd the owner's caution when dealing with a govt. agency. I will be asking questions the next time I order online or send a pipe out for repairs.
I'm just trying to pass along information, not cause trouble for a reputable repair shop.

 

[numbersix]

Good question. I am not sure either. I didn't quibble either. It's a touchy issue, especially with the tax laws being so unclear and online sales tax reforms underway. If I were him, I'd probably err on the side of caution.

 

[papipeguy]

I would think that repairs done on site do not qualify as internet sales and therefore are subject to local and state taxes. The sales tax issue has become very murky over the past year so I guess we should all be prepared to pony up on local sales taxes on any purchases/repairs in the future.

 

[jbbaldwin]

Perhaps they're even more vigilant about collecting sales tax since they don't collect personal income tax.

 

[buzkirk]

Sales tax rate for here in Tn. 9.75%
Tom

 

[tennsmoker]

The Tennessee Legislature has been lusting to get at this revenue stream. I may be all wrong about this, but the vendor is probably worried that the internet tax will become a done deal and there will be a back-dated beginning where internet businesses will have to pay back taxes starting with date, say, earlier this year.
That may not be it, but you can bet that if there a tax involved, the TN Legislature is not going to miss a chance to put it in motion. We may not have an income tax, but we pay through the nose for food, clothing, furniture, electronics, etc., with one of the highest sales taxes in the nation.
And, actually, we do have an income tax. It's called the Hall Income Tax, enacted in the late 1920s. It is a tax on individuals and other entities receiving interest from bonds, notes and dividends from stock.
The tax on internet purchases has been a roaring hot issue in the Tennessee Legislature. It is coming, and soon in this state. In fact, you buy something from Amazon, and Amazon sends you a notice that you, the buyer, are responsible for paying the state tax at the moment. That is changing as soon as Amazon gets a large warehouse operation up and running in Chattanooga. Then a Tennessee resident will pay Tennessee sales tax on every purchase.

 

[peckinpahhombre]

I don't know how the sales tax works in Tennessee, but if the payment is for a service (rather than a product, that is exported from Tennessee), I would not be surprised that TN would seek to levy sales tax for the service since the labour was performed there. That is usually how sales taxes work in most jurisdictions.

 

[john218]

Roth, pm sent.