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DOUBLE SALES TAX ON IOWA CLAY TARGETS!!!!!!

Discussion in 'Shooting Related Threads' started by Dale Stockdale, Mar 31, 2011.

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  1. Dale Stockdale

    Dale Stockdale Member

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    IOWA HOUSE FILE H663 HAS BEEN INTRODUCED TO REMOVE THE DOUBLE TAX ON THE PURCHASE OF CLAY TARGETS IN IOWA.

    THE IOWA DEPARTMENT OF REVENUE WANTS IOWA GUN CLUBS WITH RETAIL SALES PERMITS TO PAY SALES TAX ON TARGETS WHEN THEY PURCHASE TARGETS FOR RESALE, AND COLLECT SALES TAX AGAIN ON THOSE SAME TARGETS WHEN THROWN.

    UPON AUDIT THE STATE WILL GO BACK TEN YEARS AND COLLECT.

    PLEASE CLICK ON THE BELOW LINKS FOR DETAILED INFORMAITON AND A COPY OF THE FILE.

    IOWA SHOOTERS IT IS TIME TO ACT NOW! THE BILL NEEDS SUPPORT BY ALL.


    http://www.stockdalegunclub.com/2011%20TAX%20PAGE.htm

    THANK YOU,
    DALE STOCKDALE
     
  2. Kemper

    Kemper Active Member

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    Good man Dale
     
  3. Dale Stockdale

    Dale Stockdale Member

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    Iowa Message and others,

    The Iowa Department of Revenue (IDR) decided that the targets are subject to a Use tax. It is their opinion that beings the customer never really has possession of the targets the club must pay use tax. An opposing opinion to offer is, when you send flowers to someone, you do not take possession of the flowers that are being sent.

    The flouriest can order their flowers with their retail sales tax permit wholesale and are not subject to a use tax. The customer can order flowers to be sent to someone else, never taking possession and the flouriest doesn't have their costs of doing business increased by have to pay use tax on goods they sell.

    The Use tax means that gun club must obtain a Use tax permit and pay a 5% Use Tax on the targets purchased for retail. The gun clubs are to continue collection of sales tax on the targets when the targets are sold.

    Even though the tax is classified as a use tax and not a sales tax, it is still a double tax on targets. A copy of a Wisconsin law that prevents this type of double tax on targets in their state was given to 41st Distinct Representative Annette Sweeney. Ms Sweeney agrees it is double tax and introduced HF-663 to the house on 3/29/2011. The bill then sits in “Ways and Means” until it is supported by those in Ways and Means and others.

    HF-663 is based off of Wisconsin’s law to prevent the double taxes on the targets thrown in their state. The bill needs your support to move in this session at the Iowa State House. There is less than twenty days before this year’s close so anything you can do to bring awareness to the bill would be great. We need you help getting the bill to move.

    The best choice is to talk face to face with as many legislators as possible in Des Moines. Next best is to talk to your legislator face to face. If you can not meet face to face, email, call, or mail a letter asking for their help and support of HF-663.

    The Iowa State Trapshooting Association was audited. The IDR went back ten years and is demanding over $60,000.00 to be paid on the targets. Do not let your club be next. Please get involved now and get into the fight. It is right now and it is real.

    Thank you,
    Dale Stockdale
     
  4. 870

    870 Well-Known Member

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    You've probably been over this already, but I'll point out that very often, the club is not considered to be selling targets, but instead considered the consumer of the targets in its activity of providing the use of shooting facilities. In that case, Clubs owe sales tax at the time of purchase. If you aren't selling targets in the legal sense, which honestly is not an unreasonable position, they become just another cost of your operation as far as sales tax is considered, and you have to consider that tax as part of your costs when setting fees, where the shooter may, or may not be charged sales tax.

    In many states there is an exemption from sales tax for fees charged to a participant in a sporting activity. Sounds like your state doesn't have this? If you do, this is how it works - Club pays sales tax on purchase of targets as the consumer. Club considers that tax as part of its costs when setting its fees. Shooters are not charged sales tax for shooting fees (which includes targets). There is no separate charge for targets.

    Good luck.
     
  5. grunt

    grunt TS Supporters TS Supporters

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    TTT
     
  6. Dr.Longshot

    Dr.Longshot Banned Banned

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    If you have a vendors license you don't pay sales tax on purchase, only upon sales of the item.

    In some states the shooter never takes possession of the targets, so no sales tax on sales, only on the purchase.

    Weird isn't it.

    GB
    DLS
     
  7. Dr.Longshot

    Dr.Longshot Banned Banned

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    If you have a vendors license you don't pay sales tax on purchase, only upon sales of the item.

    In some states the shooter never takes possession of the targets, so no sales tax on sales, only on the purchase.

    Weird isn't it.

    GB
    DLS
     
  8. MAL-53

    MAL-53 Member

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    Good work Dale, you shooters gotta stay on top of this stuff (looks like you are)
    One state gets some junk passed, then it starts spreading.. go gettem guys. Breakemall ML.
     
  9. Franklin

    Franklin TS Member

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    sounds like the same action the state of mn has been doing to the hunting and sporting clays ranges. they have had to come up with some big sums$$$$$.
     
  10. Brian in Oregon

    Brian in Oregon Well-Known Member

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    The statute of limitations for taxes is TEN years in Iowa? I thought it was seven?
     
  11. Russ-in-Pa

    Russ-in-Pa Well-Known Member

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    They make the rules, and they adjust them as necessary.
     
  12. plaw

    plaw Active Member

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    Most elected positions are made up of someone that has a law degree,Do you know what you call 40 lawyers at the bottom of the sea? -----( a good start)
     
  13. quicky

    quicky Member

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    Here in Wyoming the tax is charged to the end-user of the product. I don't pay sales tax on material used in my shop as long as the end-user of the product pays the sales tax. I must pay the sales tax on the value-added to the material, but add it to the final cost of the product. So, a trap club would either pay the sales tax from the proceeds of the shooter entry fee or add the sales tax amount to the entry fee since the shooter is the 'end-user' of the target. Quicky
     
  14. 870

    870 Well-Known Member

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    quicky:

    You are correct, you don't pay sales tax on materials that end up transferred to the customer as part of the production process. I seriously doubt there is a double sales tax in this situation. If you buy something for resale, you generally don't pay sales tax on the purchase. The issue here appears to be the fact that many clubs look at as if they are selling targets, which is not how the law always looks at it. Some States say that the club is using the targets, since they never get transferred to the consumer. The shooter is just paying for use of the facilities.

    Determining whether there is a sale for sales tax purposes is not always clear. Consider a car wash. Soap is generally considered used by the car wash since it is not transferred to the customer. Car wash pays sales tax on the purchase, because they are not reselling it. They build that into their cost when setting the fee, and charge customers sales tax on the entire car wash fee if taxable. Just like the clay target issue here. Same potential for someone that does not understand to complain about a double tax.

    Next, consider the wax. Opposite result. Car wash is selling this, since it actually stays on the car when the customer leaves. Car wash does not pay sales tax on the purchase, they just charge the customer sales tax on the sale price.

    Only the final consumer pays the sales tax. It just isn't always simple determining who the consumer is.
     
  15. Ken Brandt

    Ken Brandt Active Member

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  16. Dale Stockdale

    Dale Stockdale Member

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    Message to Iowa shooters and others:
    The Iowa Department of Revenue (IDR) decided that the targets are subject to a Use tax. It is their opinion that beings the customer never really has possession of the targets the club must pay use tax. An opposing opinion to offer is, when you send flowers to someone, you do not take possession of the flowers that are being sent.

    The flouriest can order their flowers with their retail sales tax permit wholesale and are not subject to a use tax. The customer can order flowers to be sent to someone else, never taking possession and the flouriest doesn't have their costs of doing business increased by have to pay use tax on goods they sell.

    The Use tax means that gun club must obtain a Use tax permit and pay a 5% Use Tax on the targets purchased for retail. The gun clubs are to continue collection of sales tax on the targets when the targets are sold.

    Even though the tax is classified as a use tax and not a sales tax, it is still a double tax on targets. A copy of a Wisconsin law that prevents this type of double tax on targets in their state was given to 41st Distinct Representative Annette Sweeney. Ms Sweeney agrees it is double tax and introduced HF-663 to the house on 3/29/2011. The bill then sits in “Ways and Means” until it is supported by those in Ways and Means and others.

    HF-663 is based off of Wisconsin’s law to prevent the double taxes on the targets thrown in their state. The bill needs your support to move in this session at the Iowa State House. There is less than twenty days before this year’s close so anything you can do to bring awareness to the bill would be great. We need you help getting the bill to move.

    The best choice is to talk face to face with as many legislators as possible in Des Moines. Next best is to talk to your legislator face to face. If you can not meet face to face, email, call, or mail a letter asking for their help and support of HF-663.

    The Iowa State Trapshooting Association was audited. The IDR went back ten years and is demanding over $60,000.00 to be paid on the targets. Do not let your club be next. Please get involved now and get into the fight. It is right now and it is real.

    Thank you,
    Dale Stockdale
     
  17. 870

    870 Well-Known Member

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    Dale:

    I took a quick look at your State's law and was surprised to see there is no exemption for participants in a sporting event. I'll agree with you that legislative change or pressure on the Department of Revenue for a favorable ruling that targets are purchased for resale is the only way out, good luck with it. Minnesota will consider the Club as buying targets for resale so maybe you can get that through. It would not fly in my state.

    The florist argument wouldn't get very far I wouldn't think. The florist is obviously not the consumer of the flowers. They are sold to the customer who directs where they are to be shipped. Actual possession is not necessary to be considered a sale. You could do the same if you actually sold cases of targets instead of throwing them in your machines. The argument the State makes that the club uses the targets is not as far fetched as saying the florist uses the flowers. Obviously it could work out in your favor, since not all States take the position that the Club is using the targets as part of the service of providing sporting facilities.
     
  18. Bigbird

    Bigbird TS Member

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  19. Ken Brandt

    Ken Brandt Active Member

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