Sales Tax

kathytony1985 · 03-11-2022, 04:33 PM

Today I received an email from Karl Kenny regarding Sales Tax. For you future new owners, it looks like Escape will be required to collect your State Sales Tax on the purchase of your new trailer. They will then pass it on to your states department of revenue. A little video was included to explain what is happening. As well, he asked for documentation showing proof of payment for sales tax.

It makes sense to me. Most businesses have to collect sales tax when you make an on-line purchase, Amazon, if your state has a sales tax.

So, be ready to have a little more $$ in the bank when you finalize your payment to Escape Trailer Industries.

MVA · 03-11-2022, 04:51 PM

We received a similar email. What confused me is why ETI is collecting old data that is from many years ago?

7Gentex · 03-11-2022, 04:58 PM

Make it like buying a vehicle / trailer from dealer?

Registration, plates and title show up in the mail.

If ETI is going to have to remit the sales tax already....?

I would love to NOT have to go to the tax office for such.

Wonder if this is some state specific push..?

SRS · 03-11-2022, 05:37 PM

We've signed off on our build sheet. Haven't seen this email. For those who did receive the email from Karl, where are you in the process? I.E., are you close to having your trailer finished?

Mike G · 03-11-2022, 05:37 PM

The need for tax revenue is greater than ever, and governments are doing more and more to prevent all sorts of cheating. Which is fine, although I am a bit concerned about whether a Canadian company will have the correct tax calculations for all of the US states. It's not impossible to achieve in this computer-database era, yet I think it might increase the chance of errors to some degree.

kathytony1985 · 03-11-2022, 05:38 PM

It would have been nice to do everything at once and just deal with ETI.
Karl said there is a threshold and that they met or exceeded it with California.

kathytony1985 · 03-11-2022, 05:40 PM

https://youtu.be/uy9L_3jw9uA

Here is the video from the email.

kathytony1985 · 03-11-2022, 05:41 PM

Quote:

Originally Posted by SRS

We've signed off on our build sheet. Haven't seen this email. For those who did receive the email from Karl, where are you in the process? I.E., are you close to having your trailer finished?

We completed our purchase in Sept 2021.

Hawkeye Ed · 03-11-2022, 05:46 PM

Karl's email is probably related to a recent US Supreme Court decision South Dakota v. Wayfair, Inc. that changed sales and use tax rules for remote (online and off-line) sellers, nationwide.

Inquiring minds can read about it here: <https://www.avalara.com/us/en/learn/sales-tax/south-dakota-wayfair.html>.

One of the big issues is how the case affects foreign sellers like ETI. Questions like that are money-makers for tax professionals: <https://www.pkfod.com/insights/international-tax-considerations-in-light-of-south-dakota-v-wayfair-inc/>.

Centex · 03-11-2022, 05:46 PM

Quote:

Originally Posted by SRS

For those who did receive the email from Karl, where are you in the process?

The email and linked video explicitly stated that the intended recipients are current US resident owners of an Escape trailer purchased new from ETI.

The purpose of the email enquiry is stated to be collection of historic information about payment of state taxes by purchasers in their state of residence in order to respond to interrogatories from some state officials.

It was also made explicitly clear that ETI has no target date for any change in their process but that future affected owners would be notified if/when that is known.

kathytony1985 · 03-11-2022, 05:48 PM

Quote:

Originally Posted by Mike G

The need for tax revenue is greater than ever, and governments are doing more and more to prevent all sorts of cheating. Which is fine, although I am a bit concerned about whether a Canadian company will have the correct tax calculations for all of the US states. It's not impossible to achieve in this computer-database era, yet I think it might increase the chance of errors to some degree.

It would be pretty difficult to not pay the appropriate taxes, but I'm sure it has been done. When we went to register our trailer last year and pay the taxes we had to provide a receipt that stated how much we paid for the trailer so that they could charge us the appropriate taxes. According to the Arizona DMV person we were dealing with people in the past have just filled out the form and wrote some number that they came up with and the DMV caught on and now requires proof of purchase. I'm sure they lost some revenue in past years.

Rockhead · 03-11-2022, 05:51 PM

Quote:

Originally Posted by 7Gentex

Make it like buying a vehicle / trailer from dealer?

Registration, plates and title show up in the mail.

If ETI is going to have to remit the sales tax already....?

I would love to NOT have to go to the tax office for such.

AMEN

ritacasita · 03-11-2022, 06:13 PM

Please, this is not intended to be political. I can tell you that blue states such as California are hitting the tax situation hard. My best friend lives seven months in Idaho and five in CA. He is buying a new car from a CA dealer for delivery in Boise, ID and having problems with dealer collecting taxes ... so decided to buy online in Idaho. He has Idaho plates and has at least four times been cited in Home Depot parking lot for out of state plates. For numerous reasons they are searching every avenue to increase revenue. NC requires the sales receipt and taxes you 2% on the spot for the sale in US dollars. Trying to elude paying taxes is just difficult in every state. One of the problems with collecting at the builder is that I may live in NC but choose to register and house the camper, for example, in South Dakota or Maine. Then what?

Craiger · 03-11-2022, 11:03 PM

California because of its high DMV and sales taxes. Has been a hotbed for individuals trying to elude California taxes. As such as having a PO Box in Nevada or other low tax states. attempting to register the vehicle in that state while actually living and working in California. The California Highway Patrol is famous for pulling you over if you have a plate from one of those states they've identified as tax havens. by the way it can be a felony or a misdemeanor depending on the local county district attorney. if you ever watched Lehto's law on YouTube there was a whole scam involving exotic vehicles and registering in I believe North Dakota. In California the sales tax and DMV run at about 10% of the cost of the vehicle or trailer.

bborzell · 03-12-2022, 01:18 AM

The actual cost for California registration and tax, which was referred to as a use tax for our $49,941 21C was $4,205. $3,621 was the use tax based upon our local/county sales tax and the remainder, $584 was for license/registration.

Looks like tax, license and registration were 8.4% of sale price. Sales/use tax in CA ranges from 7.25 to 10+% depending on which county/city.

cpaharley2008 · 03-12-2022, 07:09 AM

Most states collect "sales taxes" when you title/register your Escape. You will need to register in order to receive plates to display on your new Escape. Granted there is a grace period to allow those without plates to tow their Escape home, but eventually the Tax Man has to be paid. Some states require the tags stay on the vehicle, even when sold, others allow you to transfer your plates from old to new vehicle, just like buying a car. I doubt Escape Trailers, a foreign corporation wants to start handling this domestic paperwork which varies from state to state.

JeffreyG · 03-12-2022, 07:10 AM

Michigan has gotten to where they are getting sales tax from pretty much all internet vendors. Michigan doesn't sweat getting the sales tax direct on out-of-state vehicle sellers (like ETI) because they know they are getting the money anyway. In Michigan, when you apply for a title and get a plate, you have to pay the sales tax. There's no way around it, other than driving without a plate or getting a title / plate from another state.

oldwave · 03-12-2022, 07:21 AM

Ohio requires you to pay sales tax when you get a title issued from an out of state transaction. The bill off sale from escape lists the purchase price and that is what they use to calculate. In 2017 it was a little more complicated as it was priced in Canadian and as I paid various times the exchange rate changed. Ohio sales tax is a little variable depending on county. 7% in my county.

rubicon327 · 03-12-2022, 07:39 AM

Quote:

Originally Posted by bborzell

The actual cost for California registration and tax, which was referred to as a use tax for our $49,941 21C was $4,205. $3,621 was the use tax based upon our local/county sales tax and the remainder, $584 was for license/registration.

Looks like tax, license and registration were 8.4% of sale price. Sales/use tax in CA ranges from 7.25 to 10+% depending on which county/city.

Robbery. Another $4K on top of a $50K purchase. I just titled a used boat in NJ and the tax was thankfully only 3.3% (discounted 50% to help the boating industry) but the governor of course has proposed getting rid of the discount.

Iowa Dave · 03-12-2022, 08:05 AM

I camped next to a fellow with a fifth wheel stick built in Indiana last spring. His license plate on the trailer was easy to see and it was from Montana. So as he was at the water spigot nearer our Escape, I asked him where he lived in Montana. He pointed at his tow vehicle and said “Oh, I live in Ohio but the trailer is licensed in Montana where I own a share of some land near Billings. Makes the license a lot cheaper you know? Haven’t been out there in a couple years now.”
Said he had a big horse trailer with sleeping quarters in it licensed the same way.
So I can understand the reluctance to share info with Escape, especially “historic”.
Iowa Dave

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