Sales Tax

[Centex]

Originally Posted by IanC

A word of caution. When we ordered our 17B we also added numerous extras to the build, i.e. wheel chocks, water hose, WDH, propane, etc. When we registered for plates with the California DMV we were required to pay sales tax on all of this, which is only fair. The catch is, that also increased the value of our trailer which we will be paying annually for. ....

I understand and sympathize with the situation you describe, but not all states pose that ongoing escalated registration cost problem.

In TX, for example, the annual registration fee (aka license plate renewal fee) is based strictly on the trailer placard weight rating, is constant year-to-year, has nothing to do with trailer valuation whether new or depreciated over time. For travel trailers with a GTWR of 1-6000# (all current Escape trailers) it's $45 new and annually thereafter.

Trailer valuation / price only bears on the one-time per-owner 6.25% vehicle/trailer state sales tax, nothing else (due on initial registration or upon transfer of title to a new owner). Local-option sales taxes are not allowed on vehicles/trailers.

Payment of state sales tax (to secure a title) and concurrent payment of initial registration fee (to secure a license plate) and subsequent annual license plate renewal are all handled by the resident's County Clerk's office or annex, interaction with state DMV / DOT offices is not involved at all. Annual license plate renewal can be done by mail, again payment is to the local County Clerk / Tax Assessor-Collector.
____

Back to the original topic, I'm in the camp hoping that ETI does not get forced into the position of participating in my local registration / tax payment / tax collection process. IMO/IME the current system was easy for me, there's little opportunity for defrauding the State of TX in the current system, and those miscreants intent on that sort of tax evasion will find a way in any case.

The great degree of variation among state taxing and registration schemes contributes to my opinion about that - I don't want to burden ETI with anything else to screw-up on their end.

[WillyB]

Originally Posted by IanC

A word of caution. When we ordered our 17B we also added numerous extras to the build, i.e. wheel chocks, water hose, WDH, propane, etc. When we registered for plates with the California DMV we were required to pay sales tax on all of this, which is only fair. The catch is, that also increased the value of our trailer which we will be paying annually for. Even though the DMV forms that you submit do accomodate backing those charges out, the woman at the Shasta DMV office just entered the bottom line on my receipt for the total registered value. When I pointed that out, she said she couldn't/wouldn't change it and that I would have to do so at a later date in another office. For others going through this process, make sure you let them know that the add-ons should not be a part of the registration value. In the end, it's probably not a big amount, but I really shouldn't have to pay annual taxes on all of that stuff (in the form of registration renewal).

Exactly!

We will be buying our own hoses, propane and other misc pieces for the same reason. Plus, I don't need to pay finance charges on things like that.

[kavm]

Originally Posted by Centex

I understand and sympathize with the situation you describe, but not all states pose that ongoing escalated registration cost problem.

In TX, for example, the annual registration fee (aka license plate renewal fee) is based strictly on the trailer placard weight rating, is constant year-to-year, has nothing to do with trailer valuation whether new or depreciated over time. For travel trailers with a GTWR of 1-6000# (all current Escape trailers) it's $45 new and annually thereafter.

Trailer valuation / price only bears on the one-time per-owner 6.25% vehicle/trailer state sales tax, nothing else (due on initial registration or upon transfer of title to a new owner). Local-option sales taxes are not allowed on vehicles/trailers.

Payment of state sales tax (to secure a title) and concurrent payment of initial registration fee (to secure a license plate) and subsequent annual license plate renewal are all handled by the resident's County Clerk's office or annex, interaction with state DMV / DOT offices is not involved at all. Annual license plate renewal can be done by mail, again payment is to the local County Clerk / Tax Assessor-Collector.
____

Back to the original topic, I'm in the camp hoping that ETI does not get forced into the position of participating in my local registration / tax payment / tax collection process. IMO/IME the current system was easy for me, there's little opportunity for defrauding the State of TX in the current system, and those miscreants intent on that sort of tax evasion will find a way in any case.

The great degree of variation among state taxing and registration schemes contributes to my opinion about that - I don't want to burden ETI with anything else to screw-up on their end.

Our experience is the same. The sales tax is paid up front (and we did pay it on items that should not have been included, e.g. full propane tanks) but that’s it. The cost of subsequent renewals of plates does not depend upon the acquisition price.

I too would not want ETI to be involved in that process. They should focus on doing what they are supposed to do better.

[JeffreyG]

I'm not sure if the DMV agent screwed up or what, but I was only charged sales tax on the base price of the trailer, not even including the options.


MI charges a one-time fee for a trailer plate, which is good for the life of the trailer and based on weight.

[Brian B-P]

Originally Posted by kavm

Is the location of the transaction relevant in this conversation? If ETI, based in Canada, sells its campers in CA, the nationality of the buyer seems irrelevant and it should only need to meet its obligation under the Canadian law. The buyer's post-purchase decision to move the camper to the US should not obligate ETI to conform to the US state tax requirements.

Right, but ETI does not knowingly sell trailers to U.S. residents in Canada. Of course a buyer could present themselves as a Canadian resident and complete the purchase in Canada without involving any border-crossing process or U.S. taxes, but they would then need to pay Canadian federal GST (5%) and B.C. provincial sales tax (7%)... then they're on their own taking it to the U.S.

[Ooshkaboo]

Originally Posted by JeffreyG

I'm not sure if the DMV agent screwed up or what, but I was only charged sales tax on the base price of the trailer, not even including the options.


MI charges a one-time fee for a trailer plate, which is good for the life of the trailer and based on weight.

Same here, the paperwork from Escape had the 29k standing out, so she glanced at it and I was on my way…

[Mike G]

In OK I know my cargo trailer does not need a license plate, nor does it need to be titled. I think, but not positive, that any personal-use trailer is not required by OK to be registered, titled or tagged. But they can be if the owner wishes.

[CasparScape]

What I haven’t heard from ETI is any rational explanation to justify why the company wants me to forward documentation to support how much California sales tax I paid for my 2018 E-19. I can’t imagine what possible use four-year-old sales tax data could be other than market research to set their pricing, or to gauge how much USA presence ETI wants to commit to. For these or any other business planning purposes I would think current USA state sales tax tables would be more useful, and are readily available.

[Dave Walter]

I fail to see what motivation anybody would have to comply with ETI's request.

[oldwave]

There’s a major difference to buying products out of state than a motor vehicle
You simply cannot register a title in Ohio unless you pay the sales tax at the time of the title on an out of state vehicle purchase. A problem looking for a solution

[bborzell]

Originally Posted by CasparScape

What I haven’t heard from ETI is any rational explanation to justify why the company wants me to forward documentation to support how much California sales tax I paid for my 2018 E-19. I can’t imagine what possible use four-year-old sales tax data could be other than market research to set their pricing, or to gauge how much USA presence ETI wants to commit to. For these or any other business planning purposes I would think current USA state sales tax tables would be more useful, and are readily available.

At the risk of sounding like a dead horse deserves additional injury, two things come to mind.

While finishing off our annual tax stuff, I asked our tax guy his take on the ETI request. He replied that there is a new sheriff in town with respect to state tax authorities and that many tax agencies are looking for ways to leverage companies that sell directly or as vendors to supply information so that instances of tax avoidance (otherwise known as fraud) can be brought to the attention of the agency.

If ETI’s request had stopped short of asking for documentation, it would have appeared and probably actually been totally innocuous because the information could have been anonymous and, at best, hearsay.

Given that there is no obvious business reason for a seller to ask a buyer for legal documentation to support a claim of having paid taxes, the only reasonable conclusion is that either ETI has been asked to request said documentation by a tax authority or someone at ETI believes that they might need this information in their ongoing discussion with the California Department of Tax and Fee Administration and that anonymous information is not necessarily adequate to meet ETI’s needs in those negotiations.

[Mike G]

So if no one supplies ETI with info, they can just shrug and tell the bean counters, "We tried, but no one replied, sorry." No downside.

[Rossue]

The CA Franchise Tax Board is extremely competent. I had them knock on my door when as a Cellphone Retailer we had supplied phones to people that had insurance and needed a new phone. My CPA & attorney said I did not need to count those phones for sales tax purposes, however the FTB disagreed. And I remember well the Supervisor who came down from Sacramento who said among other things:
"You gotta pay the tax....and otherwise the car dealers in Redding would go out of buisness". What he meant of course was people could just buy cars in Oregon with no sales tax.

So on my particular issue with them: they finally supplies documentation to back up their argument which was an arcane 1930's banking regulation. I was done and "paid the tax".

Bottom line- probably a good guess that ETI is feeling the FTB heat and could be trying to assuage them with documentation that yes CA your Escape owners are "paying the tax" too. Those guys could train the IRS to do a better job IMO.

[Great Eggstrications]

This might be useful information for fellow Washingtonians who hate leaving loose ends lying around...

It was over 6 long and faded years ago that we bought our E19, and we now had no recollection of whether we had actually paid our state sales tax or what the deal was. Turns out that it's real quick and easy to find out: Just go to wadolpublicrecords.nextrequest.com, and submit a records request - something like this worked for us:

We bought a new 19' travel trailer direct from the Canadian manufacturer in 2015, and took possession on xx/xx/xxxx in Sumas WA.

License: xxxxxx
VIN: xxxxxxxxxxxxxxxxx

Escape Trailer Industries
43851 Industrial Way, Chilliwack, BC, Canada V2R 4L2
1-855-703-1650

We promptly registered it at our local DMV office. The manufacturer is now requesting that we provide details regarding the payment of state sales tax, since they have reached a revenue threshold that requires details regarding the payment of the sales tax. Apparently, in 2015 there was no such requirement. Hence, we need to see a copy of whatever document shows this sales tax payment detail.

Thank you,

Remarkably enough, literally within minutes - presto! - a couple of pdf files showed up, one including all of the sales and import forms, and a second one including all of the forms pertaining to the registration and title stuff - fees and taxes included. They even highlighted the sales tax line item in yellow - wow! - but we don't particularly plan to pass this stuff around unless actually required to do so.

Anyhow, it's really nice to have something work the way it is supposed to. Might be useful for other things later.

[Craiger]

In 1970 I was in the Army and purchased a new Volkswagen beetle and I paid $12 or $15 to register it because I was in the military, no sales tax. I shipped out to Korea in 1971 left the vehicle with my father in California. When he went to reregister it, it was time. The clerk said will you have to pay this sales tax to California, and she said what did you pay for my father answered I don't really know it's my son's car and I'm registering it for him because he's overseas in the military. then she said was he on orders and my father said yes at that point she said all you have to pay as the registration which was $120. California has been getting sales tax since, ??

[Ron in BC]

Originally Posted by Mike G

So if no one supplies ETI with info, they can just shrug and tell the bean counters, "We tried, but no one replied, sorry." No downside.

It wasn't very many years ago that the border was slammed shut on ETI exporting their trailers until they complied with some regulations.

Probably if they don't comply with this latest request the border could slam shut again. The ability to slam the border shut on ETI exporting trailers is a powerful tool.

Ron

[Rossue]

Two separate issues and the VIN issue that held up exporting to U.S. was Federal. Not providing sales tax info won't slam the border shut.