Sales tax is a consumer tax collected by sellers at the point of purchase within a state and remitted to the government. Rates vary, and some items may be exempt. Use tax, on the other hand, is paid by buyers when sales tax isn’t collected, typically for out-of-state or online purchases. This prevents tax avoidance and ensures fair competition. Sales tax is collected by the seller at checkout, while use tax is paid by the buyer directly to the state afterward. Both fund public services, but use tax ensures revenue from purchases where sales tax wasn’t applied. Failure to pay use tax can result in penalties.
Source: salestaxconsulting.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
