Geographical sales tax question

[sticky52]

The misses and I are looking at purchasing a new vehicle and I had an idea about sales tax. I know there's a few states out there with no sales tax and was curious if cars also fall under that category. I'd be willing to drive to Timbuktu if I didn't have to fork over another 6.5% to Uncle Sam. Given the worldly view of Anandtech users, I figured some people might have some input on this.

 

[Hayabusa Rider]

There are states that have no sales tax. The rub is that when you register in YOUR state, you will be charged tax based on your state tax. I know of no one who has ever defeated tax on a car this way. If someone has, would love to hear it.

 

[Tripleshot]

Tax evasion. hmmmmmmm. Novel Idea.

How about an on-line car purchase? I sell computer parts on line, and I do not collect taxes on anything other than sales made in my state. Is that an option?

 

[BrunoPuntzJones]

Originally posted by: Tripleshot
Tax evasion. hmmmmmmm. Novel Idea.

How about an on-line car purchase? I sell computer parts on line, and I do not collect taxes on anything other than sales made in my state. Is that an option?

Huh? You pay tax when you register the car. You could buy it I suppose and never drive it and never have to pay tax on it. But when you go down to the Tax Assesor (or whatever) to get your tags, bring along the KY. At least that's the way it is here.

You have to watch for dealerships that do a little scam on these. Like in Louisiana if you buy a car and live in TX they can do you a favor and go ahead and take the tax. Well a lot of the time they will calculate it on LA tax which is like 7.25% instead of the TX 6.5%. Something someone may not pick up. I assume they just pocket that .75%. Not a lot, but over 20 cars a month it may add up.

 

[denali]

I'd check out Montana. In RV magazines the dealers from Montana mention the ability to set up a Montana Corporation at time of purchase, to avoid paying the taxes. I assume the car would have to be registered in Montana for this to work. Might not be to practical for a car since I think localities want them registered locally to get their hands on your money.

 

[sticky52]

The misses has family in Montana, I'll look into that. Thanks for the input, guys.