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Tax ID # and paying Sales Tax?

Discussion in 'Business Fundamentals' started by Sno ballz, Jul 20, 2005.

  1. Sno ballz

    Sno ballz Member
    Messages: 35


    I'm new to business and am curious on how paying Sales Tax as a business owner goes. If I have a Tax ID #, does that exempt me from paying taxes on purchases for my business? If that is the case, would I still pay sales tax on my equipment purchases? In other words, if I go and buy a $30k truck in MI, do I have to pay the 6% sales tax? Also if I buy a new Western plow for $3,500, will I pay the 6% on that?

    Please educate me :confused:

    Sno ballz
  2. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    You would still pay sales tax on items bought to be used in your business. The Sales Tax ID exempts ONLY items bought for resale. You would then collect sales tax when you sell it and send that to the State. Check with your state for tax laws on what you collect taxes.

    In your example, you would not be exempt from sales tax for your truck or plow. Yes, you would pay 6% on each.
  3. Sno ballz

    Sno ballz Member
    Messages: 35

    Great reply - Thank you.

    Sno ballz
  4. 042500hd

    042500hd Senior Member
    Messages: 251


    Sno Ballz, Here in Buffalo there are zones or areas where businesses operate that are exempt from taxes on any business purchase. You may want to look into that.