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Weasel Corp. has nexus in State A only. A consumer from State B purchases goods from Weasel, and Weasel is NOT required to collect sales taxes for State B. The consumer from State B owes use tax.

a. True
b. False

User Vjy Tiwari
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1 Answer

4 votes

Final answer:

True, a consumer from State B owes use tax on goods purchased from Weasel Corp., which does not collect State B sales taxes. States can tax out-of-state goods, leaving consumers to pay use tax if the seller doesn't collect sales tax.

Step-by-step explanation:

The answer to whether a consumer from State B owes use tax on goods purchased from Weasel Corp., which has nexus only in State A and is not required to collect sales taxes for State B, is true. States have the constitutional right to impose taxes on out-of-state goods if they do so without discrimination, meaning they also tax state-made goods at the same level.

However, consumers are typically responsible for paying the use tax directly to their state if the seller does not collect the sales tax at the time of purchase. For instance, the Marketplace Fairness Act of 2013 proposed requiring online merchants to collect sales taxes from their customers in other states, aligning with why a large online retailer like Amazon.com might support such a measure since it could help standardize tax collection and compliance for sellers.

User Bsnyder
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