Service Sales Taxes (for sale, HOA, buying)

[Beenhere4ever]

Early in the current legislative session, the trial balloon for a tax on services was floated. I remember some professionals making dark predictions if that became law. I was at Mall of America and a massage parlor tacked sales tax on the cost of a brief massage. I wonder if that's a special deal or just a scam. Wasn't a lot of money, but I do have to know what to expect in getting services.

[Globe199]

Sales tax on services is going to need to happen. People are buying more services and fewer goods. I can't speak to the veracity of this chart, but it shows exactly what's going on:

[QuietBlue]

That's the thing -- some services are taxed, but some are not. For example, the groundskeeping company my HOA uses has to collect sales tax on lawn care, but not on snow clearing. There's no rhyme or reason to it.

[Beenhere4ever]

My sister says the tax I paid has been one of a few selected services that have had a tax for a long time. Since I've not used those taxed services, I just didn't know. I consider that a luxury, so I'm not really averse to paying luxury taxes. I get pedicures, and if they chose to tax a pedicure, I wouldn't ***** about the tax. And if they wanted to tax these ridiculously priced brand name athletic shoes, I, who buy $29 leather shoes, would think it was sensible, especially if the money would improve education.

[golfgal]

I have to pay tax on hearing aids....apparently they aren't a medical necessity so they are subject to tax....

[Beenhere4ever]

Completely stupid. Cough drops are tax-exempt but not "medically necessary".

[Glenfield]

Our sales tax system is becoming as convoluted as our income tax system with the same results. It has more quirks, starts to drive behaviors, and people feel less and less that it's a fair system. I would rather pay a lower rate on everything I buy without carve outs or exemptions both for sales and income taxes. In addition, such a system would be infinitely easier to administer and enable us to cut the costs associated with administering the current systems.

[sholomar]

well the complexity is designed to benefit those who create the regulations in the first place... that's why the ultra rich can get away with paying 15-20% tax rates while the middle to upper middle class pays, when factoring in the social security and medicare tax, well over 30%. About the only way to get as low of a tax rate as the ultra rich is to be ultra poor, without a job, woman with kids, getting welfare... add in child support and working may not even be necessary.

[Globe199]

Obviously hearing aids should be tax-exempt. Clothing should not be. But then, sales tax is regressive anyway. I'd prefer to see the top income tax rates increase and get rid of sales tax altogether. Taxes should be tied directly to your ability to pay.

[Beenhere4ever]

There is a certain absence of special taxes on luxury goods. That could be seen as catering to those most able to pay. For some reason, when the decision is made to tax or not tax something, it goes by categories that range from survival essentials to products only multimillionaires can afford. Which of course saves the pockets of the latter since people don't care to add a tax onto the cost of living for the poorest paid consumers. The federal government had taxes on luxury goods for a long time. To me, it is odd there is tax on the cost of heating your house. Heat is a luxury? In the tundra?