Class Action Lawsuit against California Rip-off Sales Tax?

[Jimmy07]

I think we all agree that this kind of swindle stinks. I imagine the car dealers & manufacturers plus the legislatures agreed to this deal beforehand, another way to fleece us. Just by putting a different label on the paperwork. Rebate vs discount.
We all know that if a used car dealer had a car advertised at say $10K for a while then put a "Special" sticker on it for $8K and you maybe talked them down to $7K, you'd pay taxes on the $7K.
The difference is all made up BS. And no, I'm not big on conspiracy theories but I do believe that since the big corporations have interchangeable members on their Boards of Directors, the same minds carry the same thoughts and methods from corp. to corp. They don't need to "Sleep together", they are the same people, just moving from one seat to another. Or from corporate seat to gov't seat to corporate seat again.
So I suppose this is me: , or perhaps this one: But thanks to all for listening (reading) my rant, I feel a little better after venting, have a good day y'all, and stay well.

There’s a big difference between something being discounted or on sale than using a rebate or manufacturer incentive. Let’s attack this from a different direction- If I was to give you $2000 cash, and the only stipulation is that you must use it towards the purchase of a car at the time of purchase. You find a car for $10,000 straight up- no discounts or anything, and you decide to buy it, using the $2000 I gave you towards the purchase. Do you believe that you should pay sales tax on the $10,000, or $8,000?

 

[John Jensen]

I'm in Califunny and:
When I bought my new 2016 1500 the sales tax was on the MSRP + the $85.00 Document Fee.

I just bought a new 2020 3500 and the sales tax was on the negotiated price + the $85.00 Document Fee. The incentives were then subtracted.

I gifted my 2006 Ford F350 to my son. There was no tax levied and no smog requirement.

 

[Mopar73]

Sales tax only on the purchase price in Wisconsin


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[strikeu]

1. Never
2. Buy
3. Anything
4. In
5. California

 

[El Huapo]

One last thought for folks in states that don't do this tax swindle: if one state figures out a way to get into your pocket deeper, don't you know that the other states take notice? Perhaps those other states find such a maneuver distasteful and hooray for those states, I applaud you. But don't be surprised to find that it's coming for you too, unless we can kill it here (or in Virginia, yes!). Best wishes to all of us.

 

[El Huapo]

There’s a big difference between something being discounted or on sale than using a rebate or manufacturer incentive. Let’s attack this from a different direction- If I was to give you $2000 cash, and the only stipulation is that you must use it towards the purchase of a car at the time of purchase. You find a car for $10,000 straight up- no discounts or anything, and you decide to buy it, using the $2000 I gave you towards the purchase. Do you believe that you should pay sales tax on the $10,000, or $8,000?

Too weird, Jimmy07---do you sell cars?
My contention is that the advertised price shown after the "rebates" is what I paid. That is the amount of cash I handed over---$29K in my case, so that is what I believe should be subject to taxation. Remember, if you're old enough, the term "rebates" is fairly new and I believe it's being defined as taxable by our lawmakers. I also believe that the MSRP is a setup and way inflated so that they can catch people who don't know any better or convince people like me that with the rebate, it's "oh such a deal". What it means to me on the bottom line is that all their prices are inflated.

 

[John Jensen]

My contention is that the advertised price shown after the "rebates" is what I paid.

Not if you bought it in Califunny. Look at your contract, Those rebates are listed after the entries for price and taxes.

 

[Pshuman]

Same thing here in Maine. Friggin rip-off.

 

[20IndyRam]

I live in Indiana, and have purchased vehicles in the five surrounding states (MI, IL, OH, WI and KY).

I bought a new RAM 1500 Limited in Michigan in late March (just before the state shut down). Michigan collected 6% sales tax on the MSRP. Indiana will charge me an additional 1% tax (IN sales tax is 7%) on the MSRP as well (If I can ever get the damn title from Michigan).

Kentucky is the only state that applies taxes AFTER the incentives. Not that it matters, all of the surrounding states have reciprocity with Indiana. Indiana will get it's money regardless.

Wisconsin applies taxes AFTER a trade in. That would be valuable if I didn't drive my vehicles for 15 years and 300,000 Miles. It's a beautiful state, but I don't think I'll move there to save a couple thousand dollars every 15 years. The heating costs alone would kill me.

The following website may be of some use for people who want to pick up and move to save on sales taxes. Montana and Oregon don't look bad : https://www.salestaxhandbook.com/nevada/sales-tax-vehicles

 

[Scott Colbert]

Taxes too high? Sounds like a guy working for a living. What a sucker. Vote early and often.

 

[WHYTLIE03]

Same with many things in California. Go to a cellular store and sign up for a 2 year contract to get the latest iPhone for “free” and you pay the sales tax on the item you payed $0 out of pocket for. $800, $1,200, whatever.

I would and do support lower taxes in this state, and my salary is paid by taxes. I’d take a pay cut if it was representative in the amount of taxes I pay, sales, income, property, fuel, etc.

I am terrified if Gov Newsom gets what he wants and begins taking income on people in other states who are receiving their retirement they earned while working in California. I would have to do some math to figure out if staying here at a higher pay scale and paying income tax once I move out of this sinking state, is worth it, or if I move to another state and begin contributing to a retirement program that isn’t taxed, but at probably half of the income I have in California.

 

[gofishn]

...... probably should be a much younger person who lives closer to a city with bigger courts to do this, I'm in a podunk with few resources.....

Don't dismiss yourself quite so readily.
Anyone can rent a Panel Truck, buy some diesel fuel and...nevermind.


Sorry but could not help myself.

 

[Anthony Kalos]

Hey Gofishn !!!
It’s been done before !!!

 

[Anthony Kalos]

Here In Red State Alabama, vehicle sales tax is 2-3 percent of the Actual Sales Price depending on the County...
State Sales Tax is 9 percent !
So at least it’s encouraging new vehicle sales !

 

[chri5k]

Seems like most states do the same a CA with regards to how sales tax is applied to rebates and incentives. Might have to be a nationwide class action suit.

I live in Indiana, and have purchased vehicles in the five surrounding states (MI, IL, OH, WI and KY).

I bought a new RAM 1500 Limited in Michigan in late March (just before the state shut down). Michigan collected 6% sales tax on the MSRP. Indiana will charge me an additional 1% tax (IN sales tax is 7%) on the MSRP as well (If I can ever get the damn title from Michigan).

Kentucky is the only state that applies taxes AFTER the incentives. Not that it matters, all of the surrounding states have reciprocity with Indiana. Indiana will get it's money regardless.

Wisconsin applies taxes AFTER a trade in. That would be valuable if I didn't drive my vehicles for 15 years and 300,000 Miles. It's a beautiful state, but I don't think I'll move there to save a couple thousand dollars every 15 years. The heating costs alone would kill me.

The following website may be of some use for people who want to pick up and move to save on sales taxes. Montana and Oregon don't look bad : https://www.salestaxhandbook.com/nevada/sales-tax-vehicles

 

[TomB 1269]

I find it interesting that they could charge you sales tax on the sticker price verse actually negotiated purchase price. I would believe that you might be mis-understanding what you actual paid as the "purchase" price. If the truck list at $50k and you negotiate a sale price of $40K then sales taxes should be on $40k. However, if you are buying $50k truck but get a $10k rebate, and $2K for your trade and therefore only take out a loan for $42K to cover tax and extras purchased (as well as tax on any taxable extras), you would be paying tax on $50k as that was the actual sales price, the rebate and trade are the same as cash down with respect to the actual sale price.

Now, if you negotiated a sale price of $45K, got a rebate of $10K and trade your old truck for 2K, then the sales tax would be on $45k not on the actual cash paid or financed of $33k..... Also be advised you could be getting hit with extra tax due to the price of the truck be considered a "Luxury".

 

[Groo]

You live in California and are complaining that you think you are paying too much in taxes......

 

[David F]

Not true, the OP statement is incorrect. i purchased my 2019 Laramie at Bob Baker Auto Group Carlsbad, California on Dec 31, 2019 and the list price was 70,160.00, - after discount, the sale price was 60,352.00. Tax paid was 7.75% on the 60,352.00, total of 4761.37 taxes paid. Was not taxed on the sticker list price. If OP paid tax on the list price, it was not legal and should go to them for refund.

 

[MTRamFan]

What is this sales tax you speak of?

 

[tekashi96]

OP's original statement is not clear if the "discount" is referring to dealer discount or manufacturer rebate. Here in NJ, any manufacturer rebate is taxed. The reasoning is that the dealership receives the total amount before rebate (part from purchaser, and part from manufacturer), so that amount is taxed. Doesn't seem fair to the purchaser to pay sales tax on money the dealership received from the manufacturer, but that's the way it is.

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