Fact Check: Coupons and sales tax
ROCHESTER, N.Y. (WHEC)— Most of us are looking to save some money these days. If you’re like me, you love coupons! I use them whenever I can.
Recently a Farmington woman named Brenda used a coupon and was charged sales tax on the original price. She was told that’s how New York State does it. Is that true?
Brenda was buying a Ninja Foodi air fryer. They’re all the rage right now! She had a coupon to get it for $159.99. That’s $30 off. Not bad, right?
However, when she went to check out she noticed she was charged sales tax on the original price.
I looked into it and contacted the State Department of Taxation and Finance. Here’s the deal. Special rules apply when customers use coupons. Store-issued coupons generally reduce the amount subject to sales tax while manufacturers’ coupons do not.
When Brenda checked the fine print, she saw it right there. The coupon was "manufacturer funded" and sales tax may be due on all or part of the pre-discounted price.
So, yes. Depending on the type of coupon you use you can be taxed on the original price. That is a fact.
Honestly, it’s something I never knew about! There are a lot of other situations like rebates, early payment discounts, and trade-ins. Click here to read the sales tax rules for those.