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WTF? Why did AT&T charge me $70 sales tax for my iphone???

E

EdwardCTV

macrumors newbie
Original poster
Jun 22, 2009
14
0
i called in to figure out why on my banking statement AT&T charged me around $370 for my 32gb Iphone

the woman who i spoke to said the extra 70 dollars is from taxes and she reasoned that the tax is based on the fact that the retail price for the iphone is 700+? WTF?!

thats b.s.! what store is selling the iphone for 700? the 300 is the retail price for the iphone right? and even if 300 is the discounted price (which im pretty sure it isnt since thats the same price the apple store is selling it for without any discount whatsoever) ive never heard of paying tax for the full retail prce.

for those of u who ordered from AT&T how much were u taxed for ur iphone?
im on hold for a supervisor right now this is ridiculous!
 
They charged you properly. The $300 price is not a "discounted" price. It's a subsidized price. Your paying for the retail price which is $699. Everyone who got the subsidized price paid as much as you did. So simmer down.
 
I think you may be a bit confused.

The Apple store does not sell them at $299 retail.

These bad boys do retail for $599/$699 (16gig/32gig) with no-contract extension. Or at a subsidized price of $199/$299 with the renewal of contract.

That being said, I still don't know why or if they're supposed to charge the tax on the full retail price if they're giving it to you for the subsidized price.
 
Yup, I was charged tax for the FULL price of the phone. I purchased a Palm Pre 2 weeks before from Sprint and was also charged sales tax for the full price of the phone.
So, this isn't just AT&T.
I don't know what your sales tax rate is, but where I live (in the SF Bay Area) it is 9.75%! (thank you Gover-Nator).
 
I bought my 16gb from an Apple store and the total price was only 214.52. 199 for the phone and 15.52 for tax at 7.8%. I don't know why you all had to pay the full price.
 
optophobia said:
And change your title. You only got charged $70 tax not $700
Click to expand...



lmao sorry guys i was typing it with one hand on the keyboard and the other holding my phone

i tried to go back and re-edit the title it wont let me
 
It depends on what state you live in. In AZ you are only charged tax on the actual purchase price paid, not the full retail value.
My $199 phone cost me $216 after taxes. That's right.. only $17 sales tax. :D
 
yep

that is the way it works in SOME states, as the countless posts from day one will show.
 
aprofetto said:
I think you may be a bit confused.

The Apple store does not sell them at $299 retail.

These bad boys do retail for $599/$699 (16gig/32gig) with no-contract extension. Or at a subsidized price of $199/$299 with the renewal of contract.

That being said, I still don't know why or if they're supposed to charge the tax on the full retail price if they're giving it to you for the subsidized price.
Click to expand...


can someone who is familiar with CA tgaxes clarify why is it that when you purchase something "on sale" or whatever promotion/discount it is that u get on any random misc goods at a retail store you are taxed on the selling price not what the original price of the good is selling for? ie if i buy a pair of jeans that are on sale for $100 with an original retail price of $500 they only tax me on the sale price.

does saying that a price is subsidized as opposed to sayin its on sale make it so that they can still tax you on the original price?
 
Edward, I fixed the title for you. For future reference, to change your thread title, click the EDIT button on your original post, then click Go Advanced, and change the post subject in Advanced mode. When this is done on the OP the thread title changes also.

nparmelee said:
Some states require sales tax on the unsubsidized price, from http://www.apple.com/iphone/buy/
"In CA, MA, and RI, sales tax is collected on the unbundled price of iPhone."
Click to expand...

That's really interesting... the last phone I bought was my refurb iPhone (2G), which was not subsidized (right?), but I didn't remember paying tax against the unsubsidized price on previous phones -- most of the time, back then, the unsubsidized price was not even published. Then again I have not lived in any of those states. I wonder when they began that practice?
 
SFStateStudent said:
Hey OP, you might want to NOT yell at the supervisor; just apologize and hangup. I've been there and done that back in 2008, no one won in that situation either....:eek:
Click to expand...

i didnt yell at anyone i questioned the tier 1 support agent calmy and respectfully and then she offered to let me speak to the supervisor

:p i hung up and called it a day and stopped waiting after i read some of the replies in this thread.
 
EdwardCTV said:
can someone who is familiar with CA tgaxes clarify why is it that when you purchase something "on sale" or whatever promotion/discount it is that u get on any random misc goods at a retail store you are taxed on the selling price not what the original price of the good is selling for? ie if i buy a pair of jeans that are on sale for $100 with an original retail price of $500 they only tax me on the sale price.

does saying that a price is subsidized as opposed to sayin its on sale make it so that they can still tax you on the original price?
Click to expand...

Subsidized means someone else is paying for the rest of the price. In the case of the iPhone, the phone is $700, you pay $300, AT&T pay $400. You pay all the tax.

Go Oregon for no Sales tax :D
 
mkrishnan said:
Edward, I fixed the title for you. For future reference, to change your thread title, click the EDIT button on your original post, then click Go Advanced, and change the post subject in Advanced mode. When this is done on the OP the thread title changes also.



That's really interesting... the last phone I bought was my refurb iPhone (2G), which was not subsidized (right?), but I didn't remember paying tax against the unsubsidized price on previous phones -- most of the time, back then, the unsubsidized price was not even published. Then again I have not lived in any of those states. I wonder when they began that practice?
Click to expand...

thank you and i agree interesting subject to say the least. ...

especially the subject of what superficially appears to be inconsistent forms of taxing (in california) ....

u are taxed on the full price of something if it is 1.) free 2.) subsidized?

yet when something is on sale or at a discounted price you only pay taxes on the actual selling price?
 
mrkgoo said:
Subsidized means someone else is paying for the rest of the price. In the case of the iPhone, the phone is $700, you pay $300, AT&T pay $400. You pay all the tax.

Go Oregon for no Sales tax :D
Click to expand...

interesting and yes go oregon! lol :( next time i make a big purchase i will be sure to buy it when im in oregon haha

what about when a retailer absorbs profit loss from putting things on sale?
why are you then only taxed on what you actually paid for?
 
EdwardCTV said:
can someone who is familiar with CA tgaxes clarify why is it that when you purchase something "on sale" or whatever promotion/discount it is that u get on any random misc goods at a retail store you are taxed on the selling price not what the original price of the good is selling for? ie if i buy a pair of jeans that are on sale for $100 with an original retail price of $500 they only tax me on the sale price.

does saying that a price is subsidized as opposed to sayin its on sale make it so that they can still tax you on the original price?
Click to expand...

http://forums.wireless.att.com/cng/board/message?board.id=apple&message.id=77373

http://bobpage.net/2009/06/09/iphone-sales-tax-is-on-the-unsubsidized-price/

In short, all you need to know is in CA, MI, and RI you will pay tax on the unbundled price.
Why? Read here. And though this is not Apple's fault, earlier it was said that Apple was misleading customers when they technically (imho) weren't. Anyone with any experience buying a subsidized phone from AT&T in CA or any carrier would know this. I've paid tax on the full price of phones since I could remember in CA.

Links are to the State BOE, AT&T Wireless forums, and some dude's blog.
 
thegoldenmackid said:
This is what everyone gets charged, why you needed to be transferred to a supervisor for this is puzzling.
Click to expand...

well obviously i was not aware of this at the time. u live and u learn. people arent born out the womb knowing everything there is about tax laws. but now i know. :D
 
jessica. said:
http://forums.wireless.att.com/cng/board/message?board.id=apple&message.id=77373

http://bobpage.net/2009/06/09/iphone-sales-tax-is-on-the-unsubsidized-price/

In short, all you need to know is in CA, MI, and RI you will pay tax on the unbundled price.
Why? Read here. And though this is not Apple's fault, earlier it was said that Apple was misleading customers when they technically (imho) weren't. Anyone with any experience buying a subsidized phone from AT&T in CA or any carrier would know this. I've paid tax on the full price of phones since I could remember in CA.

Links are to the State BOE, AT&T Wireless forums, and some dude's blog.
Click to expand...

I live in MI and paid taxes on $199.
 
EdwardCTV said:
interesting and yes go oregon! lol :( next time i make a big purchase i will be sure to buy it when im in oregon haha

what about when a retailer absorbs profit loss from putting things on sale?
why are you then only taxed on what you actually paid for?
Click to expand...

Remember, taxes go to the government. It's completely separate to profit.

When a retailer sells something, even on sale, that's the tax - tax on the sale. Get it? Sales tax.
 
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