Gift cards -- taxable?

Old Apr 2, 18, 12:52 pm
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Gift cards -- taxable?

So, it's Q2 and I have two Chase Freedom cards to burn.. Started with buying a few GCs at a Walmart Neighborhood Market (which does code as Grocery via MCC's). Rang up the cards, paid for them, and left... noticing when I got home that they charged me sales tax on the Netflix gift cards and only the Netflix gift cards.

Someone correct me if I'm wrong, BUT shouldn't that have been non-taxable since no actual sale / exchange of services/goods happened? I figured I'd ask here before attempting to deal with Walmart's disservice desk.
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Old Apr 2, 18, 1:27 pm
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mia
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This may be helpful if you are in Florida:

12A-1.089 | Florida Sales Tax Attorney

Misunderstanding could arise:

Taxes on streaming content are less common. Washington state, for instance, levies 52 cents in sales tax on a $7.99 monthly Netflix streaming subscription. Florida meanwhile, which does not have a sales tax on digital goods, imposes a roughly 54-cent state tax on the same Netflix subscription under its communications services tax.

...but I think Netflix would collect the tax when you redeem the card, not the retailer when you purchase it.

http://money.cnn.com/2013/06/05/pf/t...tax/index.html

Last edited by mia; Apr 2, 18 at 1:33 pm
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Old Apr 5, 18, 9:58 am
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Hey, Florida has to get sales tax from somewhere since most of our merchandise sales are made with suitcases full of cash and not taxed. Heck, even sales of legal, medical marijuana down here are exempt from sales tax.
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Old Apr 9, 18, 10:28 pm
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Originally Posted by KRSW View Post
So, it's Q2 and I have two Chase Freedom cards to burn.. Started with buying a few GCs at a Walmart Neighborhood Market (which does code as Grocery via MCC's). Rang up the cards, paid for them, and left... noticing when I got home that they charged me sales tax on the Netflix gift cards and only the Netflix gift cards.

Someone correct me if I'm wrong, BUT shouldn't that have been non-taxable since no actual sale / exchange of services/goods happened? I figured I'd ask here before attempting to deal with Walmart's disservice desk.
BTW, Walmart is specifically excluded this quarter, so you will not get 5x on Freedom.
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Old Apr 10, 18, 1:22 am
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That's a good catch on Walmart. Apparently applies to Costco and Sam's Club as well. You could still get 5% if you use Chase Pay.

Fine print:
Does not include purchases made at Walmart or Target, discount, or warehouse club stores, except for purchases made with these merchants using Chase Pay or PayPal (a 5% category). If you do not use Chase Pay or PayPal you will still earn unlimited 1% cash back on these purchases.
Discover Card is even more restrictive, though I'm unclear on whether it applies to WM New Market and not just WM Supercenters
Grocery purchases made at convenience stores, gas stations, warehouse clubs, supercenters, discount stores (or at grocery stores associated with supercenters or discount stores) are not eligible. Purchases made using tap-and-pay, mobile or wireless card readers, virtual wallets or similar technology may not be eligible

Last edited by Klemhuzzah; Apr 10, 18 at 1:30 am
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Old Apr 10, 18, 6:35 am
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Originally Posted by KRSW View Post
Someone correct me if I'm wrong, BUT shouldn't that have been non-taxable since no actual sale / exchange of services/goods happened? I figured I'd ask here before attempting to deal with Walmart's disservice desk.
Back in Jan 2017, I bought VGCs from Lowe's and I was charged sales tax. It wasn't just in my area since others reported the same thing in other states. I checked the sales tax policies in my state and found out that GCs are non taxable. I spoke with the store manager of Lowe's and showed them my receipts where sales tax were charged; he called me days later to tell me to pick up my refund for taxes I paid for all GCs I purchased. Thereafter, they did not charge sales tax on GCs anymore.
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