Beware California's hidden cell phone tax - SFGate
As a Californian, I did not realize this until I went in to a local BB today to price out a new Droid, the the very attractive sales person informed me about this tax. This means that there is about a 25% tax relative to the register sales price ($199) of the phone. She was saying that it is about $50 in CA Sales Tax alone! This is because they are required to charge sales tax (9.750 % where I live in CA) based upon the original price of the phone ($599) ! I told her that I would have to send a letter to Mr. "Kali-fornia" Govern-ator himself!California Taxes Cell Phones on Real Value, Not Reduced Price
Friday May 6, 2005
The San Francisco Chronicle has an excellent story about an obscure California law that has cell phone vendors tax consumers not on the price paid but on the real value of a cell phone. So if your carrier paid $400 for phone X but sells it to you at 150$ with a service plan, in California, you will have to pay the taxes on $400. The state's argument is that the price reduction doesn't change the real value of the phone. Yet, carriers sell phones under the market price because they know they will recoup their investment on monthly charges, and so will the state as taxes are charged on monthly service. What a fallacious argument these californian taxers have!
Needless to say, I do not have a Droid yet. I wonder if you order this out of state if this tax still applies???
So check your sales receipt if you live in California and you recently bought a Droid phone!!!! An write your congress man or woman and remind them that 2010 is an election year for them!