|
No, no tax, unless one sells for more than what is was bought for. For instance, someone buy blank paper, and pays tax. Then, with the paper he paints or writes or whatever, and sell this as art for more than the paper cost: he charges tax, BUT he is then allowed to claim the paper tax back.
To summarize: buy $100 of paper, pay $15 dollar tax; sell $500 art, collects $75 tax, but claim back $15 from the goverment. This the "added value tax", essentially, the man sells back the $100 paper with $400 art on it.
But of course, this is not applicable to selling back a used item. Specifically, when I traded back my old car, they gave me $3000 for it. The new car I bought was valued at $27000. So I paid the tax on $24000 only.
The absence of tax on used good even allows some flea market stores to get away with "mild tax evasion". For instance, they claim that new items that they sell are second hand, even if they are in the original wrapper; I presume they sell it to themselves at wholesale cost before selling it retail with no tax... |
|