Warning: PSN now charges tax in more states

Cao Cao

Cao Cao

CAGiversary!
This was discussed a little bit in the PSN thread, but I think this is a notable enough topic that hasn't been publicized enough.

Today, I went on to PSN to use the last $15 in my wallet, when I noticed at the "confirm purchase" page that it was adding tax onto my purchase, something it did not do before. After some searching, I found out that last week, Sony silently added a few states to the "charge sales tax" category of PSN. Obviously, if you live in one of these states, then the simplest way to avoid the tax on your PSN purchases is to change your address to a state that still does not charge tax, like Nevada.

Here's a list of states that I've so far found started charging sales tax last week:
Arizona
Hawaii
Kansas
Pennsylvania
Tennessee
 
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so aside from nevada and california what other states dont charge tax?


so thats possibly 4 states that dont

Nevada

California

South Dakota

Georgia

Oregon
 
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Cao Cao,

Are you sure they are not charging tax in Nevada? If that's the case I'll change my PSN account address to my folks' address in Reno (though I'm pretty sure my mom says they charge sales tax when you buy stuff in the stores). I'm in AZ and yeah they just started charging tax here, not sure why all of a sudden.

Though of my co-workers said to change address to Oregon and he was able to bypass the tax charging on PSN, too.
 
[quote name='Sinistar']Cao Cao,

Are you sure they are not charging tax in Nevada? If that's the case I'll change my PSN account address to my folks' address in Reno (though I'm pretty sure my mom says they charge sales tax when you buy stuff in the stores). I'm in AZ and yeah they just started charging tax here, not sure why all of a sudden.

Though of my co-workers said to change address to Oregon and he was able to bypass the tax charging on PSN, too.[/QUOTE]

Every state has a sales tax. However, not all of them charge taxes on online purchases.

Switch to Oregon and you'll be good to go.
 
[quote name='btw1217']Alabama doesn't, at least since the last time I bought something from the Store.[/QUOTE]

Alabama has a sales tax of 4%....

I went looking deeper and it looks like Alaska doesn't have a state sales tax but there are cities that have their own taxes.

There are four states without a sales tax at the moment. New Hampshire is one of them.
 
[quote name='basilofbkrst']Isn't placing your address elsewhere to avoid taxes illegal. I remember the idea coming up in a previous related thread.[/QUOTE]

It is....dependent on the definition of is.

I kid. It's illegal.
 
Do you really think Sony is the one doing this? Perhaps, I don't know, maybe the state legislatures of the states that you posted passed a law requiring it? But yea, blame Sony. That makes sense.
 
[quote name='bunk22']been using nevada from day 1 live in new york IT'S SATURDAY NIGHT![/QUOTE]

fixed.

But yeah, no tax in GA still, just made a purchase a few hours ago.
 
[quote name='jr233270']Do you really think Sony is the one doing this? Perhaps, I don't know, maybe the state legislatures of the states that you posted passed a law requiring it? But yea, blame Sony. That makes sense.[/QUOTE]

Yeah. It's Sony's fault.
 
states have been greedy of late when it comes to taxes. like when some states started trying to get taxes from amazon for online sales. i would like to know why suddenly it seems more and more states are collecting taxes from psn purchases. why change now when theyve been tax free for years?
 
[quote name='jr233270']Do you really think Sony is the one doing this? Perhaps, I don't know, maybe the state legislatures of the states that you posted passed a law requiring it? But yea, blame Sony. That makes sense.[/QUOTE]

Please point out where I said that Sony is completely at fault for the existence of sales taxes. The point of this topic is to warn people who primarily use PSN cards, or who are saving excess funds in their wallet for something, that they may be paying more now than what they would have paid two weeks ago. However, if you, want to turn this into a "who's fault is this" topic without provocation, then I'll be more than happy to oblige just this once.

Nobody is fully blaming Sony online taxes, that would just be moronic. Of course these legislatures are responsible for taxes, but how the factoring in of taxes is implemented on PSN is entirely up to Sony. In other words:
Was it the legislators who programmed the tax collection function into the PlayStation Store, evidently with little regard for those who use PSN cards?
Was it the legislators who arbitrarily decided to expand the list of "taxed" states on PSN without any notice to PSN members?

No, in both cases, these were things that were entirely up to Sony, and the resulting implementation of sales taxes is incredibly poor for PSN members who use the PSN cards for purchases instead of a credit card. That's the key point, I'm not sour on the taxes themselves, rather I dislike Sony's chosen style of implementation of said taxes into PSN. I, along many other PSN card users, tend to plan out purchases in advance, since you are only adding arbitrary values to the wallet. If you live in one of those states that switched, then planning purchases with PSN cards has become far more difficult, since your purchasing power has now greatly decreased.

For example, let's say that two weeks ago, a person decided that he wanted the Red Dead Redemption Undead Nightmare Collection DLC. If he decided to buy it at that time, then he would have only needed a $20 PSN card to buy it. If that person waited two weeks to make the purchase, then suddenly, the purchasing power of that same $20 card has noticeably decreased, as it can no longer afford games totaling out to $20 like the RDRUNC. If the person wants the RDRUNC, then his only options using are: (a) Buy a $20 card and a $10 card to take care of the added tax. [~$9 surplus] (b) Buy a $50 card. [~$29 surplus]. Let's say he didn't know about the tax, since nothing was announced, and unknowingly bought the $20 card, thinking that it would cover the purchase. Now, after being told that the "confirm purchase" screen that he doesn't have enough, his options are: (a) The $10 card, as previously mentioned. (b) Use a credit card to cover the remainder, but since there's a $5 minimum, he's still stuck with a surplus [~$4].

Thus, those affected by the switch who currently only use PSN cards, their only options for the future will be, assuming that they want no surplus funds: (a) Switch to only paying for PSN purchases with a credit card, which allows them to use exact amounts when purchasing. (b) Change their PSN account's address to a state that is not under the "taxed states" category, allowing.

As I said, I am not taking issue with actually paying the taxes, as no one can blame, nor is anyone blaming, Sony for wanting to stay within the law. However, I do take umbrage with Sony's poor implementation of said taxes into their system, as it creates some glaring flaws for the users who primarily use PSN cards to make purchases. I also did not like that we were not given any sort of notification of the change in the list of PSN's "tax states," even after the change was made, which meant that the only way to find out about it was to try to purchase something.

It's not like there aren't any superior ways to collect taxes. I've heard, though obviously I cannot verify, that Microsoft has a much simpler way of implementing taxes: Collect it up front. That is, collect the sales tax when the points are purchased, whether they are purchased online or when a points card is purchased in a store. Under that system, the price of the point cards is increased due to the tax, but the purchasing power of the points cards on XBLA remains the same, and the potential problem of double-taxing points cards is eliminated. While I do not keep up with patent applications, it does not seem like this would be an overwhelmingly difficult thing to implement on PSN. Remove the tax on PSStore items, start charging sales tax on PSN cards, and charge the sales tax when PSStore products are purchased with a credit card.

I've said my piece, now this line of discussion is over. Let's get back to the original point of the topic.
 
Given the fact my post in the Store topic was pretty much ignored I'll post it here one last time for those who missed it and want a legal alternative to avoiding paying this small insignificant fee. Or as Cao Cao just pointed out, want to avoid paying extra money because of taxes.

[quote name='uncle5555']
Go to Amazon, buy the DLC (games, add-ons, etc.) and you get the game tax free (I just checked my Soldner X order, it was tax free)

Downside is waiting for Amazon to carry the codes or missing out on a good sale, the upside no tax. Decide if it's worth the hassle.

Hope that helps some of the folks in this thread trying to save a few cents, but that's the best alternative out there as far as I see it...[/QUOTE]

And there ya go.

I know this is irrelevant to those who use PSN cards, but not much I can do about that.

[quote name='jr233270']Do you really think Sony is the one doing this? Perhaps, I don't know, maybe the state legislatures of the states that you posted passed a law requiring it? But yea, blame Sony. That makes sense.[/QUOTE]

[quote name='lokizz']states have been greedy of late when it comes to taxes. like when some states started trying to get taxes from amazon for online sales. i would like to know why suddenly it seems more and more states are collecting taxes from psn purchases. why change now when theyve been tax free for years?[/QUOTE]

I think it comes down to many of the states are billions in the red in their budget and need a quick and easy scheme to generate revenue. Which is what brings us to where we are today.

As much as I hate to say it, Amazon isn't too far behind if some of your legislatures have their way. (Yeah I know, bite my tongue.) :whistle2:#
 
[quote name='8bitArtist']pretty sure PA doesnt[/QUOTE]


PA does now. I live here, and they didn't do it before up until I tried to buy something the other day. Now I live in Miami ;)
 
[quote name='8bitArtist']pretty sure PA doesnt[/QUOTE]
And you'd be wrong. When I went to use up my remaining $10-ish in PSN credit from a pre-paid card I bought from Kmart a month or two ago it charged me tax on my purchases.:bomb:

Yet Amazon DOESN'T and they have a physical presence in the state.:roll:

But of course Sony is just willing to bend over and let this state fuck their customers out of 6% sales tax while Amazon is still fighting the good fight(if you ask me).
 
also on my uk account it charged me tax on 1 singstar song, the other 19 it didnt (was spread out over a couple of purchases while hopping between us and uk singstar store to make sure songs werent available here), it was weird considering it only charged tax on the one time i only had 1 song in my cart
 
I live in PA, have to pay taxes. Now I would be fine with this, except for the fact that if I buy a $20 card, I can't buy $20 worth of games and have enough to cover taxes. I wish there was a way I could buy a PSN card pay the tax in store, and then have that auto added to my account.
 
[quote name='IAmTheCheapestGamer']And you'd be wrong. When I went to use up my remaining $10-ish in PSN credit from a pre-paid card I bought from Kmart a month or two ago it charged me tax on my purchases.:bomb:

Yet Amazon DOESN'T and they have a physical presence in the state.:roll:

But of course Sony is just willing to bend over and let this state fuck their customers out of 6% sales tax while Amazon is still fighting the good fight(if you ask me).[/QUOTE]

They're separate issues. Here, the state is just creating a new tax for virtual goods. On the other hand, you probably already owe tax on everything you buy from Amazon; the "physical presence" bit just determines whether the state can force Amazon to collect it from you. Which is important, because, as all the tax evasion discussion in this thread suggests, most people don't declare it.

But hey, three cheers for Amazon, fighting the good fight to facilitate tax evasion and reduce their overhead costs by systematically dumping people from their affiliate program.
 
[quote name='Magus8472']They're separate issues. Here, the state is just creating a new tax for virtual goods. On the other hand, you probably already owe tax on everything you buy from Amazon; the "physical presence" bit just determines whether the state can force Amazon to collect it from you. Which is important, because, as all the tax evasion discussion in this thread suggests, most people don't declare it.

But hey, three cheers for Amazon, fighting the good fight to facilitate tax evasion and reduce their overhead costs by systematically dumping people from their affiliate program. [/QUOTE]

I was wondering when someone would get around to linking the Use Tax thing. As for tax evasion and such, my opinion on that is still the same. I see what taxes are being spent on(aka nothing I really wanna help fund), so why should I pay for shit that doesn't directly benefit me?:booty:
 
Amazon bent right over and let New Yorkers get taxed so I would hardly say they're "fighting the good fight"

Newegg on the other hand stood up for us and didn't bow to the bullshit legislature. That's why I go with them whenever I have the choice.
 
Thanks for the heads up OP. I just moved to CA from VA and getting hit with an extra 10% can come as a big blow if youre not expecting it. I will add these to my list of states to avoid.

Anyone on here from Washington state? How are the taxes there?
 
[quote name='IAmTheCheapestGamer']I see what taxes are being spent on(aka nothing I really wanna help fund), so why should I pay for shit that doesn't directly benefit me?:booty:[/QUOTE]

There's a wikipedia link for that too.

But more to the point, seeing people complain about a 4-9% surcharge on $10-$20 purchases just makes me think of this:

simpsons-bear-patrol-plane.jpg


"Let the bears pay the bear tax. I pay the Homer tax!"
 
[quote name='Magus8472']There's a wikipedia link for that too.

But more to the point, seeing people complain about a 4-9% surcharge on $10-$20 purchases just makes me think of this:

simpsons-bear-patrol-plane.jpg


"Let the bears pay the bear tax. I pay the Homer tax!"[/QUOTE]

LOL

Also it was said there was a minimum, but in my experience I pay what I owe on my CC (including tax) and end with a balance of zero.
 
So many inaccuracies in this thread.
Here's a list of states that I've so far found started charging sales tax last week:
Arizona
Hawaii
Kansas
North Carolina
Pennsylvania
Tennessee
Click to expand...
I don't know about the other states, but North Carolina passed a digital download tax last year that came into effect Jan. 1st of this year, so I've been paying tax on PSN since then.
In other words:
Was it the legislators who programmed the tax collection function into the PlayStation Store, evidently with little regard for those who use PSN cards?
Was it the legislators who arbitrarily decided to expand the list of "taxed" states on PSN without any notice to PSN members?

No, in both cases, these were things that were entirely up to Sony, and the resulting implementation of sales taxes is incredibly poor for PSN members who use the PSN cards for purchases instead of a credit card. That's the key point, I'm not sour on the taxes themselves, rather I dislike Sony's chosen style of implementation of said taxes into PSN.
Click to expand...
This rant makes no sense to me at all. If lawmakers in your state passed a law imposing a sales tax on digital downloads, then Sony is legally obligated to charge you a tax. You buy something that's $1, Sony has to charge you $1.07 if the tax is 7%. Where the heck is Sony at fault here? How do you suggest they better implement this tax?
Given the fact my post in the Store topic was pretty much ignored I'll post it here one last time for those who missed it and want a legal alternative to avoiding paying this small insignificant fee
Click to expand...
There's nothing legal about doing this to get around tax. In every state that has sales tax, you are legally obligated to report any interstate online purchases you make and pay tax on them at the end of the year. If you don't, you are breaking the law, regardless of how little of a deal you think it is.

As a side note, you shouldn't be getting taxed when buying PSN cards in retail stores. If you are, that's something you should take up with the retailer.
 
[quote name='madcatz1999']This rant makes no sense to me at all. If lawmakers in your state passed a law imposing a sales tax on digital downloads, then Sony is legally obligated to charge you a tax. You buy something that's $1, Sony has to charge you $1.07 if the tax is 7%. Where the heck is Sony at fault here? How do you suggest they better implement this tax?[/QUOTE]

Read my post again, as I made two points very clear: 1) I was not arguing against the tax itself, nor was I arguing against Sony's intent to obey the law, rather my point was that Sony's chosen style of implementation that puts PSN cards at a serious disadvantage. 2) I already presented a superior implementation of the tax (Up-front charge) that allows them to collect the required taxes while maintaining the purchasing power of the PSN cards.

Thanks for pointing out North Carolina, I only found that in a search, and was not sure whether it was included in last week's additions.
 
[quote name='Cao Cao']Read my post again, as I made two points very clear: 1) I was not arguing against the tax itself, nor was I arguing against Sony's intent to obey the law, rather my point was that Sony's chosen style of implementation that puts PSN cards at a serious disadvantage. 2) I already presented a superior implementation of the tax (Up-front charge) that allows them to collect the required taxes while maintaining the purchasing power of the PSN cards.

Thanks for pointing out North Carolina, I only found that in a search, and was not sure whether it was included in last week's additions.[/QUOTE]

They can't charge tax upfront. There is no purchase. All you are doing is placing your funds in a different medium like a gift card. When you pay $50 on a gift card you get to spend $50 at a store including tax. You also have the issue of item is taxed where used. People boardering another state would just drive to the cheaper sales tax state and purchase their cards, thus shorting the state they are in the sales tax they deserve. So most states don't want prepay sales tax.

Another thing is you seem to want Sony to advertise that they are shortly going to charge sales tax, so either spend your $ now or buy more cards. They aren't going to do that because:
1. They don't want to advertise that in essence their prices are going up.
2. It would have to be very specific state advertising while almost all Sony advertising is done on a national level.
3. It may push a state to audit their collections from prior years. I.E. you're just collecting tax now? Maybe they should have been for the last 3 years.
4. When it's determined that they need to collect tax, they are going to attempt to become legal as soon as possible. Maybe they found out a week ago or a month ago, but the legal exposure is more of a risk that making existing customers mad.

Oh, and I didn't see it mentioned, Indiana just started charging sales tax. They charged me .07 on my purchase of battle tanks.
 
[quote name='madcatz1999']
There's nothing legal about doing this to get around tax. In every state that has sales tax, you are legally obligated to report any interstate online purchases you make and pay tax on them at the end of the year. If you don't, you are breaking the law, regardless of how little of a deal you think it is.[/QUOTE]

:drool:

That covers the .01% of people who actually do that...

So apparently Amazon's been doing it wrong all this time, and their multitude of lawyer's funneling their ill-gotten tax free gain into their cayman island off shore bank accounts...

When Amazon does what the government tells them they should charge me tax, I will pay tax.

You make it sound like we are all running around with hamburgler masks on :cool: looking to screw the govt. out of a few pennies here and there. For the record I've bought one (EXACTLY ONE) PSN title from Amazon. Otherwise like a good little madcatz worshipper, I pay my taxes, brush my teeth every day, salute the flag before I leave in the morning and say my prayers before I eat and sleep.

And while that sounded like I was being sarcastic, it wasn't totally. You're just Johnny Buzzkill is all, I'm not saying you're wrong at all, you just spout the facts all while acting like a self righteous jerk. And that's what gets on my nerves. :roll: You need to change your bedside manner Dr. Kevorkian.

And I agree with Cao Cao, I wasn't blatantly pointing out evasion tactics, just an alternative for those who NEED to do something I personally do not do. (but since you like lumping everyone into one pot, here I am defending myself to you for some F'ed up reason....:whistle2:#)

But with the way you bend comments, even the most innocuous statement can be turned around into a heinous crime against humanity the way you tell it.

I'm staying away from this thread with a 100 ft. pole, it's just a inferno waiting to happen. :hot:
 
I always love these threads. My favorite was the one about a year ago where sales tax evasion was likened to terrorism. Man, I should've saved that quote...
 
[quote name='uncle5555']:drool:

That covers the .01% of people who actually do that...

So apparently Amazon's been doing it wrong all this time, and their multitude of lawyer's funneling their ill-gotten tax free gain into their cayman island off shore bank accounts...

When Amazon does what the government tells them they should charge me tax, I will pay tax.[/QUOTE]
This isn't the UK. The US has a sales tax, not a value-added tax. Amazon never has to pay tax on anything, as they're not an end-user. Any tax that Amazon does collect, they pay to the government. Amazon doesn't lose or gain anything monetary by charging or not charging tax. Amazon is doing it right, in fact -- charging state sales tax when the sale is in-state (ask the people in New York, for example), and not charging their own state's sales tax when the buyer is out-of-state, since it's the buyer's state gets the sales tax (or not, since most don't claim it), not the state of the seller.
[quote name='uncle5555']You make it sound like we are all running around with hamburgler masks on :cool: looking to screw the govt. out of a few pennies here and there. For the record I've bought one (EXACTLY ONE) PSN title from Amazon. Otherwise like a good little madcatz worshipper, I pay my taxes, brush my teeth every day, salute the flag before I leave in the morning and say my prayers before I eat and sleep.

And while that sounded like I was being sarcastic, it wasn't totally. You're just Johnny Buzzkill is all, I'm not saying you're wrong at all, you just spout the facts all while acting like a self righteous jerk. And that's what gets on my nerves. :roll: You need to change your bedside manner Dr. Kevorkian.

And I agree with Cao Cao, I wasn't blatantly pointing out evasion tactics, just an alternative for those who NEED to do something I personally do not do. (but since you like lumping everyone into one pot, here I am defending myself to you for some F'ed up reason....:whistle2:#)

But with the way you bend comments, even the most innocuous statement can be turned around into a heinous crime against humanity the way you tell it.

I'm staying away from this thread with a 100 ft. pole, it's just a inferno waiting to happen. :hot:[/QUOTE]
I wasn't jumping on anyone for buying stuff from another state online and not claiming it in their own state. We all do it. I was correcting someone when they were telling people that it was legal to do so, when they were wrong. I'm sorry I decided to correct misinformation I saw on the internets.
 
Noticed this yesterday when I got spend crazy on half-priced UC2 content. Lame.

I'm not paying sales tax in store on the cards anymore though-- there were some retailers doing that originally. So as long as I'm not getting double taxed, I'm cool with it.
 
[quote name='nbballard'] So as long as I'm not getting double taxed, I'm cool with it.[/QUOTE]

That's my only problem, being double taxed. If get taxed at the counter when I buy it, I don't want them to tax me again.
 
I hate this new tax system. My debit card doesn't work because it has a really complicated/confusing billing address(won't verify my address at all) meaning I HAVE to use the PSN cards. It sucks that I can only buy cards in 20 and 40 dollar chunks. With tax it makes it even more of a hassle.

It would be nice if we could prepay "ANY AMOUNT" we want on a custom card so this tax won't be a problem.
 
I still can't get over the fact that these states are charging tax for virtual goods, which are in all practicality, essentially a service (since you're really buying a license to use the game, not ownership of the game). I hope people start to sue these states and win, this is total BS.
 
Saw a week ago that Illinois charges tax aslo. I don't really like it with all of it being DLC but oh well. Would rather the PS3 use points like is done on the 360.
 
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