Tax being imposed on $30.00 upgrade fee

[thanh1081]

First, I disagree with the $30.00 upgrade fee newly imposed by Verizon Wireless.  Today, I realized that that Verizon Wireless charges/collects 5% (VA) tax onto $30 upgrade fee.

I looked up VA Sale and Communication tax code and figured that VA doesn't require tax to be imposed on fee.  This can happen to a lot of you who are upgrading since most states do not require customers to pay tax on fee that is imposed by the providers.  The providers responsible for the tax if they make money off of the fee.

Here's additional information about VA tax code if anyone interest:

Sale tax: http://lis.virginia.gov/cgi-bin/legp604.exe?000+cod+TOC58010000006000000000000

Communication Tax: http://www.tax.virginia.gov/site.cfm?alias=CommunicationsTaxes#guidelines

I believe that we should have this cleared out and hold Verizon Wireless accountable. 

Message was edited by: Thanh Vo

[lewisr13]

If they're collecting it, they are required to submit it to the taxing authority, regardless if they are supposed to be collecting it or not. So it's not Verizon that's getting your $1.80 it's the VA taxing authority.

[thanh1081]

Regardless, we're not required to pay tax on upgrade fee if the law of such state doesn't require it.  It's Verizon's fault to include it in.  Do we absolutely know that Verizon actually submit that 5% of the $30 to VA since VA doesn't require it?

[lewisr13]

No, it's all a conspriacy.

[thanh1081]

Still, lewisr13, the fact of the matter is that customers in VA are being charged $1.50 for the charge that they aren't required to pay.  And it's Verizon's fault to have this happen.

[lewisr13]

I perused the Communications Tax and didn't see anything specifically exempting the upgrade fee. What makes you think it should be exempt?

[thanh1081]

Where does it say an upgrade fee or any fee is required to pay 5% sale tax?  Are you working for Verizon by any chance because your point or interpretation is directing at the other spectrum.

Administration of the tax: The communications sales tax is generally administered in the same manner as the Virginia Retail Sales and Use tax. The tax is imposed on communications services at the rate of 5%, and appears as a line item on customers' bills.

Taxable services: The services subject to the communications sales tax include but are not limited to:

• Landline and wireless telephone services (including, but not limited to local, intrastate, interstate and international service) including Voice Over Internet Protocol;
• Teleconferencing services;
• Private communications services;
• "Push to talk" services;
• Pager and beeper services;
• Automated or partially automated answering services;
• Facsimile services;
• 800 number services;
• Telegraph, telegram, telex and teletypewriter services;
• Cable television (including but not limited to basic, extended, premium, pay-per-view, digital and music service); and
• Satellite television and satellite radio.

An upgrade fee isn't constituted as a service.  The same reason I don't pay tax on convenient fee when I pay a bill online.

[lewisr13]

thanh1081 wrote:

Are you working for Verizon by any chance because your point or interpretation is directing at the other spectrum.

ooops, you caught me.

[lewisr13]

Are we, oops they charging you sale tax on the full price of the phone or on the discounted price? Just want to make sure we are collecting all we can.

[thanh1081]

Your reply only makes me think you're an idiot.  I'm sorry to call you name but I have to.  Do you pay tax based on the cost of manufacturing or the marked price?